Netflix has had a wobble with its shareholders, with a 14% drop in share value occurring after the iconic streaming service failed to match its growth targets with regards to new subscribers signing up.
The boffins behind the streaming service had predicted that 6.2 million new subscribers would sign up in the three month period leading to the end of June 2018. This would have been a one million increase from the same period last year, which saw 5.2 million new members joining up in the same months.
However, rather than enjoying that year-on-year increase in new member numbers, Netflix stayed on level pegging. Just the same as last year, 5.2 million new members signed up in this three month period.
This, of course, is still fairly strong. Most online platforms would be popping open the champagne if they snared 5.2 million new members in three months. But because Netflix had forecast an increase, telling the world it would get 6.2 million new members in these three months, the shareholders don’t seem very impressed.
After the markets closed yesterday, Netflix shares plunged in value by 14% because of this news. Netflix doesn’t seem to be too worried, though, with a letter from the streaming service to its shareholders calling this a “strong but not stellar quarter” and pledging to “keep improving” in future.
To put things in perspective a bit, let’s not forget that Netflix made $3.9 billion in revenue during this three month period – with $384.3 million of that being pure profit. New member numbers may not be quite where the Netflix chiefs want them, but there is still plenty of cash coming in.
We’ll bring you more Netflix news as we hear it.