Forget Netflix and chill: Netflix might not be feeling very chilled about its latest subscriber numbers. The online streaming giant fell short of its subscriber growth targets for the second quarter of the year, igniting stockholders’ fears that its pace of expansion is slowing down.
Netflix stocks fell more than 14% on Monday in after-hours trading after the company failed to meet projected subscriber numbers.
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According to Variety, Wall Street analysts had expected 1.23 million new subscribers in the US, with 5.11 million overseas. Netflix itself was almost as hopeful. But the figures are in, and the company has instead reported 670,000 new subscribers in the US and 4.47 million internationally.
“We had a strong but not stellar Q2,” Netflix executives wrote in their quarterly letter to shareholders. “This Q2, we over-forecasted global net additions.”
It’s worth noting that Netflix are forecasting a 5 million net increase in subscribers during Q3, which is down from their 5.3 million prediction across the same period last year. Most of their growth is again expected to take place outside of the US, with 0.65 million expected domestically and a further 4.35 million internationally.
But the latest figures are important: other than a blip in Q2 of 2016 when subscriber growth suffered a shortfall (CEO Reed Hastings: “We never did find the explanation to that”), Netflix has had a two-year streak of over-delivering on projected subscriber growth – until now.
Still, it’s not all bad news. Netflix reported Q2 revenue of $3.91 billion (£2.96 billion), up 40% year over year, and still managed to end the quarter with 130.1 million global subscribers, up 25% year-on- year.
And the on-demand giant can take comfort in its 112 nominations for this year’s Emmy Awards, which broke HBO’s 17-year streak as the top-nominated broadcaster.
Shows such as The Crown and Stranger Things helped Netflix to become the first streaming service to take that honour in the history of the Emmys.