Netflix Shares Drop 5% as New Membership Slows
Although its still on track for its best year ever.
Amid reports that subscription prices may be on the rise, Netflix has reported how many net memberships were added in the last quarter, with 2.2 million new subscribers now using the service. This shows a marked drop from the same quarter last year, when the streaming service was able to add 6.8 million new memberships. Overall, Netflix now has 195.2 million subscribers, which is one million less than Wall Street analysts had projected.
The slower-than-expected user growth led to a drop in share prices, with Netflix posting earnings of $1.74 USD per diluted share on revenue of $6.4 billion USD. This is slightly below analysts projected earnings of $2.13 USD per share o $6.38 billion revenue. The drop comes after a strong 2020 so far for Netflix, with huge subscriber gains over the last two quarters — driven by people staying at home during the coronavirus pandemic — leading to a 70% stock increase.
Despite quarter three’s figures, Netflix has still added more paid memberships (28.1 million) in the first nine months of 2020 than it did across all of 2019. Additionally, the streaming service predicts another 6 million memberships will be added over the last quarter, taking the overall today for 2020 to significantly higher than 2018’s record of 28.6 million.
In other business news, Coca-Cola plans to reshape its business portfolio with less drinks on offer.
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