Netflix has passed 150 million paying subscribers around the world, the company has revealed in its earnings report for the second quarter of 2019.
Altogether, the streaming giant posted revenue of $4.92 billion USD (about $6.42 billion CAD), in-line with Wall Street’s $4.93 billion (roughly $6.43 billion CAD) projection.
However, Netflix actually reported a loss of 130,000 subscribers in the U.S. for the first time. Further, the company only added 2.83 million new subscribers around the world — nearly half of the expected five million.
In a letter to shareholders, Netflix CEO Reed Hastings attributed the underperformance to a weaker content slate for Q2 2019 and price hikes in various countries. Hastings also noted that the over-forecasted 9.7 million new subscribers added in Q1 may have “more pull-forward effect than we realized.”
According to Netflix, some of its most notable original movies and shows that premiered during Q2 2019 include the Ali Wong-Randall Park romantic comedy Always Be My Maybe (viewed by 32 million households in its first month), limited drama series When They See Us (viewed by 25 million households) and young adult romantic comedy The Perfect Date starring teen heartthrob Noah Centineo (watched by 48 million households in its first four weeks).
Looking forward, Hastings expects Netflix to have a strong third quarter thanks to such original content as the third seasons of Stranger Things and Ozark, the seventh and final season of Orange is the New Black and original comedy specials from the likes of Whitney Cummings and Aziz Ansari.
However, Netflix will face increased competition towards the end of Q3 from Apple’s TV+ streaming service, which will launch worldwide this September. Streaming services from Disney, Warner Media and NBC Universal will also debut in the months following the debut Apple TV+, which will result in content like Disney movies, The Office and Friends leaving Netflix.
In its letter to shareholders, Netflix acknowledged the loss of this content but noted that this will open up “budget for more original content.” According to Netflix, its most popular licensed titles like Friends and The Office only account for a low single-digit percentage of overall streaming hours.
“From what we’ve seen in the past when we drop strong catalog content (Starz and Epix with Sony, Disney, and Paramount films, or 2nd run series from Fox, for example) our members shift over to enjoying our other great content,” Netflix said.
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