Netflix’s shares tumbled by 14% on Monday after the streaming platform reported slower-than-anticipated subscriber growth between April and June. Netflix’s quarter earnings announced on Monday showed that the platform had added 5.15 million members in the second quarter of 2018, more than a million short of its April forecast of 6.2 million new users. According to The Hollywood Reporter, this is Netflix’s weakest quarter in terms of subscriber growth since the first quarter of 2017.
In a letter to shareholders, Netflix CEO Reed Hastings called the quarter “strong but not stellar” and did not mention why the the company was unable to meet its subscriber growth targets. He also cited Netflix’s Emmys achievement – the company last Thursday beat HBO to become the network with the most Emmy nominations, ending the latter’s 17-year streak. The letter added that other financial metrics, including earnings, margins, and revenue, were in line with expectations and “way up from prior year”.
According to reports, the results are a cause of concern for investors amid growing competition with streaming platforms including Amazon and Apple.
Netflix’s new subscribers include 4.5 million international users (against a planned 5 million) and 670,000 domestic ones. The streaming giant is increasingly focusing on its international offerings, including in India, where it launched its first Netlix original series earlier this month (Sacred Games). In April, it released its first Danish series, The Rain, has plans to release a new foreign-language programme at least once a week next year.
A Bloomberg report suggests that potential new customers may have been distracted by the Fifa World Cup, which ended on Sunday and is among the most-watched television events in the world.
Netflix now has 130 million subscribers, across 190 countries.