rivals to finance growth in its streaming business and expand overseas. The company earned $47.1 million, or 87 cents a share, on sales of $595.9 million, a year earlier.ĭomestic subscriber growth is particularly important because Netflix has used its wide lead over U.S. Analysts were projecting profit of $1.10 a share on sales of $919 million, according to Bloomberg data. DVD subscriptions will fall “sharply” to 10.3 million to 11.3 million customers.įourth-quarter profit will be $19 million to $37 million, or 36 cents to 70 cents a share, on revenue of as much as $875 million, the company said. There’s no grand gestures, there’s just a lot of steady and intense efforts.”ĭomestic streaming subscriptions are forecast to decline this month, level off in November and rebound in December to end at 20 million to 21.5 million, Netflix said. “We are going to work on improving the user interface, expanding to more platforms and delivering more content. “Our streaming marketing has been very effective in the past two years,” Hastings said. Hastings downplayed the likelihood of a big increase in marketing efforts. Sweeney, director of research for Bloomberg Industries.
subscriber growth in the fourth quarter will require significant ramp-up in Netflix’s marketing spending,” said Paul T. Investors are trying to gauge the extent of the fallout from the price increase and aborted plan to put DVD customers on a new service called Qwikster.
The last time the stock was trading so low was in April 2010, but that was during an extraordinarily steep ascent, after the company nearly erased the omnipresent blue and yellow storefronts of Blockbuster.Īfter what critics said was the poor execution of the attempted split and the resulting fallout, Netflix CEO Reed Hasting was quick to try to reassure investors the core business model was strong. The stock is down from more than $300 just 3 ½ months ago. Netflix shares tumbled $41.34 to $77.50 in late morning trading Tuesday. By doing so, the company created what many perceived to be a more complicated rental process at a company that began its meteoric rise with a new, easier way of searching for and finding entertainment effortlessly.
The company is betting that its future is in streaming video, and CEO Reed Hastings has said he expects Netflix’s DVD subscriptions to steadily decline, much like what has happened to AOL Inc.’s dial-up Internet service.īut Netflix bungled a spin off its DVD-by-mail service, giving it the name Qwikster and creating separate accounts for people who wanted both DVDs and movie streaming. Many people also canceled service, especially on the DVD-by-mail side. Its website was flooded by comments from angry customers. The exodus began after the company raised its prices by as much as 60 percent in July and split up its streaming and DVD rental services. Netflix said it expects more defections in coming months. In September, the company predicted it will lose about 600,000 U.S. That’s down about 800,000 from June and worse than what the company had hinted at before. Netflix revealed late Monday that it ended September with 23.8 million U.S. Netflix shares plunged 35 percent Tuesday after the one-time Wall Street favorite revealed a massive departure of subscribers angered by price increases and other questionable changes at rental service that was created to make entertainment a snap. Netflix (NFLX) stocks tumbled on Tuesday after news that the company had lost over 800,000 subscribers, many of whom were angered by an abortive attempt by the company to split its streaming and mail-delivery video services.