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Investors did not like what they saw in Netflix’s second-quarter results.
Shares of the company plunged by more than 11 percent in after-hours trading following the company’s release of data on new subscriptions that fell short of Wall Street expectations and company guidance.
Netflix added 2.7 million subscribers in its second quarter, down from about 6 million new subscribers in last year’s second quarter and well below the 5 million or so expected. The company actually lost about 130,000 domestic subscriptions in the second quarter. Internationally, the company added 2.83 million subscribers, well below the consensus forecast of 4.81 million.
Prior to the stock’s reaction to the quarterly results, Netflix had been an investor favorite, rising more than 35 percent in 2019.
Despite the disappointing subscription numbers, revenue jumped to $4.92 billion, which was only slightly below estimates. Profit fell to $270 million from $384.3 million a year ago.