During the Q1 2020 fiscal quarter, Netflix has added as much as 15.77 million paid subscribers globally. This is nearly twice more than 8.2 million net paid subscribers expected. Yesterday, NFLX was slightly down.
On Tuesday, the media-services provider Netflix Inc (NASDAQ: NFLX) delivered its Q1 2020 report. Despite some results outperformed analysts’ expectations, Netflix (NFLX) stock closed 0.84% down at $433.83. After hours, it slightly rebounded to trade at $434.60.
The lowest point Netflix shares have had so far this year was on March 16, when the stock closed at $298.84. The all-time high closing price was $439.17 on April 16, 2020. In general, NFLX shares are 34.08% up, partly due to people streaming more video as a result of spending more time at home. The average Netflix stock price for the last 52 weeks is $332.08.
Netflix Q1 Results
Netflix reported revenue of $5.77 billion and $1.57 per share for the first quarter of 2020, which exceeds prediction of $5.75 billion but falls short of the anticipated $1.64 earnings per share.
What has really astounded in Netflix’s Q1 report is the rise in the number of its subscribers. During the Q1 2020 fiscal quarter, the company has added as much as 15.77 million paid subscribers globally. This is nearly twice more than 8.2 million net paid subscribers expected.
The spike of daily sign up to Netflix’s page was in March. Besides, that month, the number of daily active users on the Netflix mobile app especially increased in countries like Greece, the Philippines, Italy, and India.
In a letter to shareholders, Netflix wrote:
“There are three primary effects on our financial performance from the crisis. First, our membership growth has temporarily accelerated due to home confinement. Second, our international revenue will be less than previously forecast due to the dollar rising sharply. Third, due to the production shutdown, some cash spending on content will be delayed, improving our free cash flow, and some title releases will be delayed, typically by a quarter.”
With the new users, Netflix’s audience around the world has grown to 183 million paid subscribers.
In Q2 2020, Netflix is planning to add another 7.5 million global paid subscribers. However, the company noted this figure is “guesswork”, as it is difficult to say when the pandemic is over and quarantine ends.
Netflix CEO Reed Hastings said:
“We don’t use the words guess and guesswork lightly. We use them because it’s a bunch of us feeling the wind and it’s hard to say. But again, will internet entertainment be more and more important over the next five years? Nothing’s changed in that.”
In the third quarter of this year, the company expects lower net subscriber additions, as more economies may open to recover after the coronavirus crisis.