(LR) Reed Hastings and Ted Sarandos participate in the world premiere of the TV series “Marseille” Netflix at the Palais Du Pharo in Marseille, on May 4, 2016 in Marseille, France.
Stephane Cardinale | Corbis | Getty Images
Netflix shares fell as much as 11% in trading after the program, after reporting a large shortage of subscribers in its first-quarter profit report. The company also said it expects to add about 1 million subscribers in the current quarter.
Here are the key numbers:
- Earnings per share (EPS): $ 3.75, compared to $ 2.97 expected, according to the final survey conducted by analysts
- Income: $ 7.16 billion, compared to $ 7.13 billion expected, according to Refinitive
- Global paid net subscriber additions: 3.98 million compared to the expected 6.2 million, according to Factset
“We believe that the increase in the number of paid members has slowed down due to the large increase in Covid-19 in 2020 and lighter content in the first half of this year, due to delays in Covid-19 production,” Netflix said in a letter to shareholders.
Netflix continued to compete against a large number of competitors, including Disney + Disney and Hulu, AT&T HBO Max, Apple TV +, Amazon Prime and Comcast NBCUniversal’s Peacock. The company said in its report that it does not believe that competition plays a factor in the low number of subscribers.
“We do not believe that the intensity of competition changed significantly in that quarter or was a significant factor in the variance, because excessive forecasts were recorded in all our regions,” according to the report.
Netflix also anticipates its content to return later in the year, following production delays caused by the Covid-19 pandemic.
“As mentioned earlier, production delays at Covid-19 in 2020 will lead to a list for 2021, which is stronger second half weighted with a large number of returning franchises,” the company said.
The company said production is back and operating in almost all of its major markets. If this continues, Netflix said it expects to spend more than $ 17 billion in cash on content this year.
The company’s revenue grew 24% year-over-year and was in line with the forecast at the beginning of the quarter, Netflix said. It also earned a strong revenue stream compared to Street estimates.
Netflix has also approved a buyback program to repurchase up to $ 5 billion in joint stock, starting in 2021 without a fixed expiration date. The quarter is expected to begin, the company said.
This story is developing. Please check again for updates.
Disclosure: NBCUniversal is the parent company of CNBC.
Subscribe to CNBC on YouTube.