(LR) Reed Hastings and Ted Sarandos attend the world premiere of the Netflix TV series “Marseille” at the Palais Du Pharo in Marseille on May 4, 2016 in Marseille, France.
Stephane Cardinale | Corbis | Getty Images
Netflix shares fell as much as 11% in out-of-hours trading operations after reporting a large subscriber shortfall in its first-quarter earnings report. The company also said it only expects to add about a million subscribers in the current quarter.
Here are the key numbers:
- Earnings per share (EPS): $ 3.75, up from $ 2.97 forecast, according to Refinitiv analysts survey
- Income: $ 7,116 million, up from the projected $ 7.13 million, according to Refinitiv
- Global Net Pay Subscriber Increases: 3.98 million versus the expected 6.2 million, according to Factset
“We believe that paid membership growth slowed due to Covid-19’s big push forward in 2020 and a lighter slate of content in the first half of this year, due to delays in Covid production -19 “, Netflix said in its letter to shareholders.
Netflix has continued to face a number of competitors such as Disney + Disney + Hulu, AT & T’s HBO Max, Apple TV +, Amazon Prime and Comcast NBCUniversal’s Peacock. The company said in its report that it does not believe competition played a role in the low number of subscribers.
“We do not believe that the intensity of competition changed materially during the quarter or was an important factor in the variation, as excessive forecasting occurred in all our regions,” according to the report.
Netflix also expects its content to recover by the end of the year, following production delays caused by the Covid-19 pandemic.
“As we noted earlier, delays in production of Covid-19 in 2020 will lead to a heavier 2021 slate in the second half with a large number of franchises returning,” the company said.
The company said production is back in operation in almost all of its major markets. If that continues, Netflix said it expects to spend more than $ 17 billion in cash on content this year.
The company’s revenue grew 24% year-over-year and coincided with the forecast for the beginning of the quarter, Netflix said. It also produced a strong pace in profits compared to Street estimates.
Netflix also approved a repurchase program to repurchase up to $ 5 billion in common stock, starting in 2021 with no expiration date set. The quarter is expected to begin, the company said.
This story is unfolding. Please check for updates again.
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