Categories
News

Netflix Reports Huge Subscriber Miss

Netflix delivers worst subscriber performance since Q2 2016; expects subscriber additions to be down year-over-year for first-half of 2021

please share

Netflix ‘s stock is down more than 5 percent in pre-market trading Wednesday after the tech giant reported that it missed expectations on global subscriber growth for the quarter.

During the first half of the year, Netflix experienced explosive growth. This quarter, when lock-downs were lifted, it was not anticipated to match the first half growth rate. However, analysts were still expecting it to meet expectations of at least 3.3 million new global subscribers.

  • The company missed Wall Street expectations on earnings per share, meaning that it invested more money than investors had hoped compared to subscriber revenues.
  • Netflix also said it expects paid net subscriber additions to be down year-over-year in the first half of 2021, surprising investors, and the reason for the pre-market selloff.

By the numbers:

  • Earnings per share (EPS): $1.74 vs. $2.14 expected, according to Refinitiv consensus estimate.
  • Global paid net subscriber additions: 2.2 million vs. 3.57 million expected, according to FactSet.

The ongoing uproar over “Cuties,” a French film which most say exploits “children’s hypersexualization,” may have dented the once solid growth of Netflix. While the company did not mention “Cuties” in their earningS report, most analysts agree the film played some part in the lower than expected subscriber numbers.

In the immediate aftermath of a #CancelNetflix protests, at least two analytics firms said their data showed Netflix was facing higher “churn” rates, which calculate subscription cancellations.

At least four state attorneys general have since asked Netflix to pull the film; Sen. Ted Cruz (R-Tex.) urged a criminal investigation; Sen. Mike Lee (R-Utah) said he was disappointed with Netflix’s apology; and Netflix was indicted earlier this month by a Texas grand jury for promoting “lewd material of children.”

Netflix, Inc.
NFLX
$503.38
-0.24%
Marketcap
$222.39B
Volume
3.03M
Shares
441.80M
Range
$493.50 - $506.80
52 Week Range
$290.25 - $575.37

One reply on “Netflix Reports Huge Subscriber Miss”

Knowing someone watches Netflix, is like knowing someone is a pedophile.

Who wants people thinking like that about them?

The Democrats with Biden signs on their lawn, is tantamount to a signed confession.

Leave a Reply