The streaming service added just 3.98 million subscribers in the first quarter, missing Wall Street’s estimated 6.29 million.
Reducing pandemic blockages has a much more severe impact on the growth of Netflix Inc. than expected, the submission of its shares fell to 13% on Tuesday.
The streaming service added just 3.98 million subscribers in the first quarter, missing Wall Street’s estimate of 6.29 million and its own forecast of 6 million. The current quarter will be even more challenging, with Netflix predicting 1 million new customers – a fraction of the 4.44 million projected by analysts.
Netflix has been warning for months that growth will slow after Covid came out of hibernation, but few expected it to stop so dramatically. The first quarter of 2020 was the strongest in the company’s history, with 15.8 million new customers, and Netflix’s pace was still surprisingly fast in the fourth quarter.
In contrast, the last three months marked the slowest first quarter of 2013, when Netflix added about 3 million customers.
The lack of new shows can also contribute to the crisis. The company’s production slowed in the first quarter due to the fall of the pandemic, which led to production delays. Netflix has managed to support its launch schedule for the first few months of Covid blocking, as it has already finished many shows. But the films and programs that were supposed to be in production in March, April and May last year had to stop, leading to the current deficit.
All this coincided with a worsening of streaming competition, from Disney +, HBO Max and Apple TV + to new entrants such as Discovery + and Paramount +. Some are less expensive than Netflix, which raised its prices in the US in October.
Europe continues to be a bright spot for Netflix. The streaming service added 1.81 million customers across Europe, the Middle East and Africa, leading the company. “Lupine”, a French thriller, was the most popular new series this quarter.
Netflix fell to $ 480 in extended trading, which would be a low in 2021. The stock rose 1.6% this year to Tuesday in New York.