Tech

Netflix subscriber growth slows as the economy resumes

Netflix Co., Ltd.

NFLX -0.88%

Consumers in many countries began to break out of the pandemic blockade, and as streaming competition intensified, subscriber growth was weaker than expected in the first quarter, he said.

The company announced on Tuesday that it added an additional 4 million subscribers worldwide between January and March. This is below the projected 6 million people.

Stocks fell 11% in after-hours trading. Inventory has increased by almost 26% in the last 12 months.

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The increase in the first quarter was also well below the 15.8 million subscribers added in the same period last year. Coronavirus epidemic At first it became fierce, and people went home and became obsessed with content.

Netflix Operations Chief Gregory Peters said at an investor event last month that “it will improve the engagement you get when people are in a blockade.”

In a letter to shareholders, Netflix said, “We believe that Covid-19 has made great strides in 2020 and that content slate has slowed earlier this year, slowing subscriber growth.” Covid-19 production delay.. “

Intensifying competition from

Walt Disney Co., Ltd.

DIS -2.48%

Disney +,

AT & T Of a corporation

According to Netflix, HBO Max and other streaming services weren’t involved in the company’s lack of quotes.

“I don’t think the fierce competition has changed significantly or was a significant factor in the quarter,” Netflix told shareholders. According to the company, retaining existing subscribers was in line with expectations.

Netflix said it expects subscriber growth to recover later this year, when some of the more successful shows, such as “The Witcher” and “You,” will return in fresh episodes. Netflix predicts that it will spend more than $ 17 billion on content this year.

Over the last few weeks, Netflix has also moved to strengthen its content through acquisitions and licensing agreements. It signed a five year contract Sony Pictures Entertainment was well worth more than $ 1 billion for the studio’s theatrical streaming rights starting in 2022. He also spent $ 440 million on the right to make two sequels to the movie “Knives Out,” starring Daniel Craig.

The company’s quarterly earnings were $ 1.71 billion ($ 3.75 per share), compared with $ 542.2 million ($ 1.19 per share) in the year-ago quarter. Revenue increased from $ 6.64 billion to $ 7.16 billion.

Netflix predicted net profit of $ 1.36 billion and revenue of $ 7.13 billion over the period.

Overseas market subscribers continued to drive growth in the first quarter. Netflix reported that it has gained 1.8 million new subscribers in regions including Europe and the Middle East, and 1.4 million across Asia. Latin American subscriptions increased 360,00 and US and Canada increased 450,000.

The company closed in March and had approximately 208 million subscribers worldwide. We expect an additional 1 million new subscribers to be added in the second quarter, compared to more than 10 million in the year-ago quarter.

Many vaccinated consumers are leaving home and shifting their spending despite the prolonged threat of the coronavirus. Airlines want a resurgence On a summer trip. Movie theater And other places have reopened in New York, Los Angeles and elsewhere. Restaurants and hotels, Was hit hard by both pandemic closures and restrictions, and strengthened employment.

Netflix made a number of changes last year amid a surge in new subscribers.The· The company said in July Promoting Ted Sarandos to Co-Chief Executive Officer with Reed Hastings. October, Netflix Raised monthly fee The most popular streaming plans are $ 1 to $ 13.99 per month and premium services are $ 2 to $ 17.99 per month.

Last month, the company also Started experimenting with stronger password enforcement To prevent users from sharing their account.

Creatively, Netflix is ​​on track. The film received 36 Oscar nominations, including two of the Best Film Awards, Mank and The Trial of the Chicago. Oscar will air this Sunday.

The launch of Disney + has brought a bit of magic to companies whose stock prices have skyrocketed after the coronavirus closed theme parks and cinemas. The WSJ describes how Disney’s streaming platform has become a top competitor in already crowded areas. Photo Illustration: Jacob Reynolds / WSJ

Write to Joe Flint joe.flint@wsj.com And Mika Maidenberg micah.maidenberg@wsj.com

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Netflix subscriber growth slows as the economy resumes

Source link Netflix subscriber growth slows as the economy resumes

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