Netflix shares fell Thursday night after the close, despite the streaming giant reporting relatively positive second-quarter gains amid the coronavirus pandemic.
Netflix announced Thursday that it had added 10.09 million more paid subscribers than expected, as audiences joined their homes due to Covid-19 restrictions and watched their shows in the absence of live events and theaters.
The jump in global subscribers during the quarter ended June 30 was well above analyst estimates of 8.07 million, according to research firm Refinitiv. The company’s revenue also increased 24.9% to $ 6.15 billion in the second quarter, beating estimates of $ 6.08 billion.
However, the company forecast that paid subscribers would drop below estimates in the third quarter, in an early sign that the drive-lock momentum could be easing as housewife orders ease and rise. layoffs and licenses in all industries. The unfavorable forecast caused shares to drop 10% in after-hours trading.
Still, Netflix is easily in first place for streaming platforms and is expected to continue, said Eric Haggstrom, an analyst at eMarketer. Globally, Netflix is on track to have 453.5 million individual users by 2020, according to eMarketer, 9.1% more than last year.
“The pandemic and associated blockages have massively accelerated the switch from linear TV to video streaming,” said Haggstrom. “Looking ahead, even as the locks are relaxed and new competitors begin to scale their services, Netflix will extend its leadership as the first stop for entertainment.”
This year Netflix will reach 72% of viewers, while Amazon Prime will reach 60% and Hulu will reach 38.9%, according to eMarketer figures.
“We live in uncertain times with restrictions on what we can do socially and many people turn to entertainment to relax, connect, feel comfortable and stimulate themselves. As we navigate these turbulent circumstances, we focus on our members as we continue to improve the quality of our service and bring new movies and shows to people’s screens, ”the company said in its letter to shareholders.
Netflix also said it has appointed chief content officer Ted Sarandos as co-CEO.
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