This March 19, 2018, file photo shows the Netflix app on an iPad in Baltimore. Netflix reports financial results Tuesday, April 16, 2019. (AP Photo/Patrick Semansky, File)

Netflix adds 9.6M subscribers in 1Q as competition heats up

Netflix expects to add another 5 million subscribers during the current quarter ending June

Netflix kicked off the year with the biggest subscriber gains in the history of its video-streaming service, but it still managed to disappoint investors by forecasting a springtime slowdown.

The strong first-quarter performance coincided with Netflix’s biggest U.S. price increases and emerging streaming challenges from Walt Disney and Apple, two of the world’s most popular brands.

READ MORE: Campaign calling for regulation of Facebook, Netflix launches in B.C.

The video service added 9.6 million subscribers worldwide during the first quarter of 2019, topping the projections of both Netflix’s own management and Wall Street analysts. It’s the most subscribers that Netflix has gained during any three-month stretch since the Los Gatos, California, company unveiled its streaming service 12 years ago.

The surge announced Tuesday left Netflix with nearly 149 million subscribers through March.

Netflix expects to add another 5 million subscribers during the current quarter ending June, but that projection fell well below analysts’ forecast. It would also represent a decline from the 5.9 million customers that the service picked up during the same period last year.

Netflix’s stock dipped 1% in extended trading to $355.85 after the numbers came out.

In a discussion streamed on video, Netflix CEO Reed Hastings likened the past quarter to a “perfect clean shot” down the middle of a golf course’s fairway while drawing comparisons to Tiger Woods’ victory in the Masters tournament.

Netflix tested the bounds of its popularity with a recent a recent price hike that raised the cost of its most popular plan to $13 a month, a $2 increase. New U.S. subscribers had to start paying the higher price in January, but it only recently started to hit existing customers.

The company said it doesn’t expect the price increase to trigger significant cancellations, though its second-quarter forecast implies otherwise. It expects to add just 300,000 U.S. subscribers from April through June, down from 700,000 at the same time last year.

Competition facing Netflix will heat up toward the end of this year when both Disney and Apple plan to start selling their own video-streaming services backed by big budgets.

Disney’s offering, due out in November, could be a bigger threat because it will feature a library of classic films supplemented with original programming cooked up by a company with a proven record of churning out crowd-pleasing entertainment. What’s more, the service — called Disney Plus — initially will cost just $7 per month.

Apple hasn’t disclosed the pricing of its service, which will include programs featuring renowned stars such as Oprah Winfrey, Jennifer Anniston and Jason Momoa, nor a specific date for its debut.

“There’s a ton of competition out there, and Disney and Apple add a little bit more but frankly, I doubt it will be material,” Hastings said.

Besides the good news on subscribers, Netflix’s first-quarter profit of $344 million rose 19% from the same time last year; it included a $58 million gain from currency adjustments. The company earned 76 cents per share during the first quarter, 18 cents above the estimate among analysts polled by FactSet.

Netflix’s revenue climbed 22% to $4.5 billion.

But the company continues to spend more cash than it is bringing in as it pours money into a lineup of TV series and films that has been attracting more subscribers. The company burned through another $460 million in the quarter and expects its negative cash flow this year to exceed last year’s total of a negative $3.5 billion.

Michael Liedtke, The Associated Press

Like us on Facebook and follow us on Twitter

Just Posted

PHOTOS: Staycation Stampede Style

Ponoka FCSS hosted its annual Stampede staycation event on June 18

AMBER ALERT: Alert cancelled after child located safe and unharmed

Alert cancelled after child located safe and unharmed

Fighting financial fraud against seniors

Alberta Securities Commission hoping to curb seniors being taken for granted

VIDEO: ‘Avengers: Endgame’ to be re-released with new footage

‘Avatar’ holds global box office record at $2.788 billion, while ‘Endgame’ stands at $2.743 billion…

VIDEO: Acknowledging skeptics, finance minister vows to build Trans Mountain project

Bill Morneau said he recognizes ‘huge amount of anxiety’ in Calgary over future of oil and gas sector

Shovels could be in the ground on Trans Mountain by September, CEO says

Ian Anderson points to weeks likely required for NEB to reinstate 2016 regulatory record

Calgary man facing charges after B.C. police service dog aids in arrest

Heavy police presence results in PSD Jagger finding suspect

RCMP allows officers to grow beards

Members can now wear beards and goatees, as long as they’re neatly groomed

Wildfires have forced more than 9,000 people from homes in northern Alberta

People in other communities remain on evacuation alert and could be told to leave quickly

Pride divided: Edmonton leadership under pressure as LGBTQ community looks to future

Most of the conflict can be traced back to 2016 Toronto Pride when Black Lives Matter staged a protest

Federal cabinet ministers visit Edmonton, Calgary, in wake of TMX approval

Natural Resources Minister Amarjeet Sohi is set to visit Trans Mountain Corp.’s terminal in Edmonton

Statistics Canada reports annual pace of inflation rises in May to 2.4%

Transportation prices gained 3.1 per cent as the cost of air transportation added 8.9 per cent

Most Read