Netflix failed to reach the number of subscribers it expected to add in the second quarter, despite revenue growth of 26%.
In its Q2 results released today, the streaming media company reported paid membership grew by 2.7 million, well bellow the 5 million it forecasted. It’s also down on the 5.5 million extra subscribers it added in the same quarter last year.
The streaming giant currently has 151.56 million subscribers around the world, up 21.9% year-on-year.
Netflix reported “flat” membership numbers in the US where it lost subscribers for the first time since 2011. The US was down by about 130,000 paid members. Netflix expects to return to growth next quarter.
The business still reported 26% growth in revenue to $US4.923 billion compared to the same quarter last year. Total profit was $271 million, down from $384 million in the same three months in 2018.
Netflix recognised increasing competition with the arrival over the next year of Disney, Apple, WarnerMedia and others. It also rejected rumours it will start selling advertising on its platform.
“We, like HBO, are advertising free. That remains a deep part of our brand proposition; when you read speculation that we are moving into selling advertising, be confident that this is false,” it said in filings to the US SEC.
“We believe we will have a more valuable business in the long term by staying out of competing for ad revenue and instead entirely focusing on competing for viewer satisfaction.”
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