Netflix only loses 970,000 subscribers in second quarter after warning of loss of 2 million
Netflix reported earnings after the bell. Here are the results:
- EPS: $3.20 vs $2.94 per share, according to Refinitiv.
- Revenue: $7.97 billion, vs. $8.035 billion, according to Refinitiv survey.
- Global paid net subscriber additions: A loss of 970,00 subscribers vs. expectations of a loss of 2 million, according to StreetAccount estimates.
Analysts are split on whether subscriber losses will be better or worse than Netflix predicted. Some expect the company to lose as many as 4 million subscribers, while others foresee a loss of 1.5 million.
Those who expect smaller subscriber losses have pointed to the streaming service’s popular series “Stranger Things.” The fourth season of the show was released in two parts, one at the end of the second quarter and one at the beginning of the third. Some analysts expect that the split may have limited churn or even driven subscribers to sign up or return.
The company’s guidance for subscriber numbers in the third and fourth quarters will likely be more important than second-quarter figures. Another forecast of subscriber losses could send the company’s stock spiraling.
According to StreetAccouont estimates, analysts expect around 1.8 million net subscriber adds in the third quarter, as Netflix’s slate of content increases and concerns about price increases ebb.
There is also the hotly anticipated ad-supported plan, which is in the works and could lure back lapsed customers or encourage new sign-ups with a lower price point. No date has been set for the roll-out of the option, but more information about its development Tuesday could improve investor confidence in the company.