After years of explosive growth, Netflix’s string of bad decisions this year is definitely catching up with them.
Released today, the third quarter earnings report for Netflix showed a net loss of 800,000 subscribers since last quarter. While their overall subscriber base was still up 42 percent year-over-year, it brings to an end over two years of explosive growth. Net subscription additions were down .81 percent sequentially from last quarter, and down a staggering 145 percent year-over-year, a first for the company since Q3 2009 which this report dates back to.
Netflix has now broken its subscribers into streaming and DVD rentals, so it’s going to be a bit harder from here on out to tell at first glance just how the company is doing, but from a profit standpoint, they are projecting a slight increase over the last quarter. For this quarter they had projected 21.8 million streaming subscribers, but finished up with 21.45 million instead. On the DVD side of the equation, the company expected 14.2 million, but ended with 13.93 million.
The market has not reacted well to this news, and the stock price has declined around 27 percent in after hours trading, falling well below $100 a share.
While Netflix isn’t going to go under any time soon, things are looking rough for this former darling of Wall Street. After numerous mis-steps such as the Qwikster debacle, and raising the ire of consumers with a price hike this summer, it had to be expected that this would be the result, but it is doubtful that anyone at the company is too happy about it.
Did you expect worse results from Netflix’s quarterly report?