Netflix adds record 6.74 million subscribers but stock tanks on weak forecast

[Shawn Knight]

Netflix in January revealed it had expanded its reach into 130 new countries. As a result, the streaming video provider on Monday said it added a record 6.74 million new subscribers during the first quarter of 2016 which brings its total subscriber count to 81.5 million.

Broken down, that equates to 2.23 million new subscribers in the US and 4.51 million newcomers internationally, beating estimates of 1.82 million and 4.49 million, respectively. The growth eclipses Netflix’s previous record of 5.59 million additions in Q4 2015. In the year-ago quarter, Netflix added 4.48 million customers.

Revenue for the quarter checked in at $1.96 billion, or $0.06 per share – just shy of the $1.97 billion Wall Street expected.

The company credited the launch of several series including Making a Murderer, Fuller House, season four of House of Cards and Daredevil season two for its strong performance.

By most accounts, this would be considered a stellar quarter. Why, then, has Netflix’s share value taken a nose dive in after-hours trading (it’s down roughly 10 percent as of writing)?

As it turns out, shareholders are worried about Netflix’s ability to sustain growth. For the second quarter, Netflix is expecting to add just 2.5 million subscribers globally which includes a paltry 500,000 domestically. During the second quarter of 2015, the company added 3.3 million global subscribers.

In fairness, it’s worth pointing out that Q2 is typically a low growth quarter for the company.

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https://www.techspot.com/news/64487-netflix-adds-record-674-million-subscribers-but-stock.html

 

[WangDangDoodle]

I used to only subscribe to Netflix when they released new original content that I really wanted to watch, such as House of Cards. I'd cancel my subscription right away, because I saw no reason to keep it going any longer. I'd binge through the new content in a weekend and be done with it.

But, now they've smartened up, putting out one episode per week for certain shows, like Better Call Saul. This forces me to keep the subscription going if I want to keep watching. It's a good way to make sure they earn enough to keep going and keep making awesome original content.

Now that I've kept an active Netflix subscription for about half a year, I find that it's more useful than I originally thought. I primarily use it watch movies with friends from other countries, while on Skype. At some point, we get sick of ranting and gaming, but then there's always Netflix.

That said, I really hope this stock situation turns around. I want more Marvel shows, and I don't care if I have to pay twice as much for a subscription. Worth it!

 

[Skidmarksdeluxe]

Right now Netflix is about as popular as a ham sandwich in Jerusalem over here, they don't even bother to advertise anymore.

 

[RustyTech]

Right now Netflix is about as popular as a ham sandwich in Jerusalem over here, they don't even bother to advertise anymore.

Mmmm piggy...fooooooood!!
Although I'd probably good with a turkey or beef sandwich myself. Pork just doesn't have the taste I like.

I remember a very similar argument a few years back. Netflix CEO said back then that he doesn't care what Wall Street thinks; they're making money, adding subscribers, and that's good. The rest will sort itself out - and it has.

 

[Raoul Duke]

$7.99 a month, seriously how can you go wrong? I do NOT want it to fill up with TV though.

 

[Skidmarksdeluxe]

Mmmm piggy...fooooooood!!
Although I'd probably good with a turkey or beef sandwich myself. Pork just doesn't have the taste I like.

I remember a very similar argument a few years back. Netflix CEO said back then that he doesn't care what Wall Street thinks; they're making money, adding subscribers, and that's good. The rest will sort itself out - and it has.

I'll tuck into the beef (or ham) sandwich, turkey isn't really my taste.
Yup, it's true. Making dosh is the only thing that counts. I wouldn't be surprised if they withdraw it here for a while then come back later. Nobody I've spoken to is even remotely interested in it.