🎬 Netflix’s mooching cut

RIP red-envelope DVDs… this one’s for you. Netflix shares dipped yesterday, and not because the streamer announced it’s ending DVD rentals (was still a thing). It added only 1.7M new subscribers last quarter — fewer than half what Wall Street was expecting. Netflix said subscriber growth would be similar this quarter, but hopes for brighter days ahead.

• Play next… ad. After rolling out in November, Netflix's $7/month US ad-tier now earns more revenue per subscriber than its standard plan, which costs twice as much.

• Three months left… to use your ex’s password. Netflix delayed its global “paid sharing” plan (ahem, password-mooching crackdown) in the US and other major markets until June. It doesn’t expect the extra $$ to kick in till the third quarter.

Are you still watching… on Mom’s account? 100M people use someone else's Netflix without paying. In February, the streaming icon launched its paid-sharing plan in countries including Canada, Spain, and New Zealand. Cue: searches for “cancel Netflix account” soared 8X. FYI: nearly two-thirds of zillennials have canceled a streaming sub in the past six months.

• But Netflix said the initial “cancel reaction” was followed by a boost in subscriptions and revenue. Canadian subs have grown since the crackdown, despite it costing $8/month to add new users to accounts — and revenue there is growing faster than in the US.

“Cause it's like you're my mirror”… but maybe not for long. Lululemon reportedly wants to offload its in-home-fitness biz, Mirror, to its competitor Hydrow. The soft-pants producer bought the exercise startup for $500M in 2020 as living-room sweat sessions drove sales (goodbye suits and gym memberships, hello leggings and Pelotons). Now the 70-pound wall-mounted “mirror,” which displays fitness classes, is weighing down profits.

• Self-reflection: In its last reported quarter, Lululemon said it took a nearly $443M impairment charge related to Mirror.

• Losing more than a few pound$... Lululemon discounted the Mirror device to $1K (down from $1.5K) as sales came in below expectations.

Buffing out the profit problem… Mirror's drag on earnings has threatened to sour Lulu's otherwise sweet business. Last month the company's stock stretched up after it beat expectations (picture: a 30% sales jump) and shared rosier-than-expected guidance. Other comfy-first brands that saw a pandemic bump (like Crocs) have likewise seen customers hesitant to shift back to “hard clothes.” But Lulu's rush into hardware hasn't aged as well as its leggings

• Teslash: Tesla slashed US prices for the sixth time this year as competition stiffens and EV tax-credit standards get tougher. Yesterday the carmaker reported that its Q1 profit fell 24% as the cuts dented margins.

• Nevermine: Intel axed its first bitcoin-mining chip less than a year after its debut at the onset of “crypto winter.” The move follows a reheated debate over the environmental toll of bitcoin mining.

• Board: United Airlines unloaded a quarterly loss after business travel dipped following Silicon Valley Bank’s collapse. Like Delta, United sees a profit on the Q2 horizon as summer travel demand booms.

• Cleanup: Population loss in rural areas is leading small grocery stores to close their doors. USDA data shows that 76 US counties are without a single grocer, limiting the areas’ access to healthy food.

• Settled: In an 11th-hour deal, Fox News agreed to pay $788M to Dominion Voting Systems ahead of their trial, in one of the largest defamation settlements ever. Fox said “certain claims” it made about Dominion were false.

• Earnings expected from AT&T, TSMC, American Express, Alaska Air, and Union Pacific

Authors of this Snacks own bitcoin and shares of: Alaska Air, Delta, and Tesla