Netflix Subscriber Growth Slows, Shares See 11% Slump
Netflix’ said slower production of TV shows and movies during the pandemic hurt subscriber growth in Q1, sending the streaming giant’s shares down 11% on Tuesday.
Roughly 3.98 million people have signed up for Netflix from January through March, way below the 6.25 million average analyst forecasts. Additionally, Netflix estimated it will add just 1 million new streaming customers in Q2, falling short of analyst expectations of 4.8 million.
During the quarter, Netflix has also lost one of its most popular titles when workplace comedy "The Office" moved to Comcast’ streaming service - Peacock. Netflix additionally raised its monthly rates in Britain, Germany, Argentina and Japan.
The streaming giant’s shares slumped 11% in after-hours trading to $489.28, wiping $25 billion off the company's market capitalization - a contrast to the last 12 months which gave the stock a 27% overall increase and a whooping 15.8 million new customers, as the company capitalized on the pandemic-infused stay-at-home lifestyle.
The company predicts membership growth would accelerate in the second half of the year when it releases new seasons of "You," "Money Heist," and "The Witcher" , action movie "Red Notice” and more.
The company earned $3.75 per share in Q1, beating analyst estimates of $2.97 per share. Revenue rose to $7.16 billion from $5.77 billion during the quarter, edging past estimates of $7.13 billion. Net income rose to $1.71 billion from $709 million a year earlier.
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