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 NetflixB次元官网网址檚 biggest U.S. price increases and emerging streaming challenges from Walt Disney and Apple, two of the worldB次元官网网址檚 most popular brands.
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The video service added 9.6 million subscribers worldwide during the first quarter of 2019, topping the projections of both NetflixB次元官网网址檚 own management and Wall Street analysts. ItB次元官网网址檚 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 analystsB次元官网网址� forecast. It would also represent a decline from the 5.9 million customers that the service picked up during the same period last year.
NetflixB次元官网网址檚 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 B次元官网网址減erfect clean shotB次元官网网址� down the middle of a golf courseB次元官网网址檚 fairway while drawing comparisons to Tiger WoodsB次元官网网址� 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 doesnB次元官网网址檛 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.
DisneyB次元官网网址檚 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. WhatB次元官网网址檚 more, the service B次元官网网址� called Disney Plus B次元官网网址� initially will cost just $7 per month.
Apple hasnB次元官网网址檛 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.
B次元官网网址淭hereB次元官网网址檚 a ton of competition out there, and Disney and Apple add a little bit more but frankly, I doubt it will be material,B次元官网网址� Hastings said.
Besides the good news on subscribers, NetflixB次元官网网址檚 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.
NetflixB次元官网网址檚 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 yearB次元官网网址檚 total of a negative $3.5 billion.
Michael Liedtke, The Associated Press
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