Netflix reports biggest subscriber increase since launch but gains set to slow | Business News




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Netflix has reported the biggest increase in subscribers since it launched 12 years ago, adding 9.6 million in the first quarter.

Some 1.74 million people signed up in the US and 7.86 million signed up elsewhere – both above the average analyst estimates.

The video streaming service said the gains were better than expected and left them with a total of nearly 149 million subscribers.

Netflix chief executive Reed Hastings likened the past quarter to a “perfect clean shot” down the middle of a golf course’s fairway, drawing comparisons to Tiger Woods’ victory in the Masters tournament this week.

That pace is forecast to slow, however, with Netflix saying it expects to add only another five million during the next financial quarter, which ends in June.

The news disappointed investors and was well below analysts’ forecasts. It would also be below the 5.9 million subscribers Netflix added in the same period last year.

Part of this drop is a predicted fall in new US subscribers – from 700,000 in last year’s second quarter to a forecast 300,000 this year.

The company recently increased its price in the US by $2 a month to $13 (£9.95).

Netflix shares dipped 1% in extended trading to $355.85 (£272.33) but in regular trading it closed up around 3% or $359.46 (£275.09).

Haris Anwar, senior analyst at Investing.com said: “What’s making investors nervous is that there are signs of a slowdown in the second-quarter subscriber growth.

“This is made all the more prominent by the looming threat of competition from Disney and Apple.”

Disney and Apple plan to launch video streaming services towards the end of this year.

In other financial results, Netflix’s first quarter profit of $344m (£263m) was up 19% from the same time last year and its revenue was up 22% to $4.5bn (£3.4bn).



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