Netflix, about to be involved in a streaming war, made US$5.245 billion in its third quarter financial report and global subscriber numbers increased by 6.8 million to 158.33 million.
“Since our US price increase earlier this year, retention has not yet fully returned on a sustained basis to pre-price-change levels, which has led to slower US membership growth,” Netflix said in its quarterly letter to shareholders. “On a member base of more than 60 million, very small movements in churn can have a meaningful impact on paid net adds.”
The gain of 6.8 million subscribers was a third-quarter record, a 12% increase on the same quarter in 2018, Netflix added. In the US, there were 500,000 new subscribers, below Netflix’s own estimate of 800,000, however it was, as predicted a bounce back from a second quarter result which saw subscriber numbers fall.
For the fourth quarter, the company is projecting 7.6 million extra members worldwide, compared to the actual 8.8 million new members in the fourth quarter of 2018, perhaps reflecting the direct-to-consumer competition coming from Apple (Apple TV Plus) and The Walt Disney Company (Disney+) in the next six months.
However Netflix was bullish about the threat to its market share, saying it would hurt broadcast television companies most.
“Just like the evolution from broadcast TV to cable, these once-in-a-generation changes are very large and open up big, new opportunities for many players,” Netflix told investors.
“For example, for the first few decades of cable, networks like TBS, USA, ESPN, MTV and Discovery didn’t take much audience share from each other, but instead, they collectively took audience share from broadcast viewing.”
Matt and Ross Duffer’s Season 3 of Stranger Things was viewed by 64 million households in its first four weeks on the platform, the hit series’ best numbers to date, and last month Netflix employed co-creators and twins Matt and Ross Duffer to the streaming service, which will see them produce more TV shows and films for Netflix. A fourth season of Stranger Things has also been agreed.
Figures also show that 41 million subscribers watched film Tall Girl, starring Ava Michelle, in its first 28 days and 32 million subscribers watched CBS TV Studios’ series Unbelievable in its first 28 days.
Wall Street analysts had expected earnings of US$1.04 a share, but Netflix delivered US$1.47, nearly double the 89 cents a share 12 months ago.
- Disney+ launches in the US, Canada and The Netherlands on 12 November. It will launch in Australia and New Zealand on 19 November
- Apple TV Plus launches on 12 November
- WarnerMedia plans to unveil more details about the pricing, distribution, user interface and content plans for HBO Max at its 29 October presentation to investors. HBO Max is scheduled to launch around April next year.
- NBCUniversal’s streaming service Peacock will launch in April next year.