Netflix (NFLX) reported mixed first-quarter results Tuesday, missing subscriber growth expectations while beating analysts’ earnings-per-share expectations.
The stock, which initially fell as much as 12% after the release, saw losses in shares as investors digested the report — the first since co-CEO and co-founder Reed Hastings stepped down from his leadership position at the company.
Here are Netflix’s first-quarter results compared to Wall Street estimates, as compiled by Bloomberg:
he won: $8.16 billion vs $8.18 billion expected
Earnings Per Share (EPS): $2.88 For the expected $2.86
Participants: 1.75 million vs. 2.3 million expected net additions
Earnings and revenue projections were disappointing after Netflix revealed that it expects $8.24 billion in revenue and $2.84 in diluted EPS for the second quarter — below Wall Street’s forecast of $8.5 billion in revenue and $3.05 in diluted EPS.
The results come as investors eagerly await updates regarding the company It recently launched the ad-supported layerin addition to what is controversial Suppress password sharing.
Netflix, which has expanded its crackdown to countries like Canada, New Zealand, Portugal and Spain, as well as test countries like Chile, Costa Rica and Peru, has revealed that it plans a “large-scale rollout” of the crackdown this quarter that will include the United States.
“While we could have fired it [paid account sharing] Broadly in the first quarter, we found opportunities to improve the member experience. We’re learning more with each rollout and integrating the latest information, which we believe will lead to better results,” the company wrote in the release, adding that it’s “pleased with the results” so far despite the near-term turbulence seen in Latin American markets.
Netflix also revealed more insights into the ad-supported tier, telling contributors to the release: “Although it’s still very early days, we remain pleased with the progress we’ve made across all key dimensions: member experience, value for advertisers, and increased contribution to our services.” Ad engagement exceeds our initial expectations and, as expected, we’ve seen very little switching from our standard and premium plans
Dubbed Basic with Ads, the ad plan costs $6.99 per month in the US and serves as a complement to Netflix’s ad-free tiers – the Standard ($15.49 per month) and Basic ($9.99 per month.) plan.
“Given the current healthy performance and trajectory of ad economics for each member, particularly in the US, we are upgrading our ad experience with more streams and enhanced video quality to appeal to a broader range of consumers,” the company added.
Alexandra Channel He is a senior correspondent at Yahoo Finance. Follow her on Twitter aliecanal8193 and email it to [email protected]
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