Catholics need to stop citing this number, not only because it is outlandishly false but because it is not the point how many Protestant denominations there are. The point is the scandal of division and the love of private judgment that has caused so much of it. The scandal would be no less if there were two denominations, and no greater if there were two million. Any division in the body of Christ is a scandal. To argue over how many is a red herring.
The real point is St. Paul’s words in Ephesians 4:4–6:
There is one body and one Spirit, just as you were called to the one hope that belongs to your call, one Lord, one faith, one baptism, one God and Father of us all, who is above all and through all and in all.
—from We Need to Stop Saying There are 33,000 Protestant Denominations by Scott Ericalt at the National Catholic Register