Netflix reported revenue of $4.19 billion for the quarter that ended in December, slightly below the $4.21 billion that Wall Street analysts had forecast, according to IBES data from Refinitiv. For instance, Netflix faced a huge backlash in 2011 when it unbundled video streaming from its older DVD-by-mail service, resulting in a 60 percent price increase for subscribers who wanted to keep both plans.
Netflix's operating margin shrank in the quarter, because of the heavy load of titles released. The company also called out the successes of content overseas from Turkey and the United Kingdom. Netflix said Thursday that it expects to spend about US$3 billion more cash than it takes in during 2019.
The video streaming pioneer's shortfall in revenue expectations disappointed investors looking for a bigger payoff from the company's recent decision to raise prices as much as 18 percent for its US customers.
If there is anyone who thinks that it is ok because a stock footage company has the rights to it, imagine a fictional show or movie needing video of a random building being demolished and deciding that the World Trade Center on 9/11 is flawless.
Netflix was ahead of the pack when it came to getting customers to cozy up inside their homes and binge shows and movies. The company believes that worldwide markets will one day account for as much as 90 per cent of its customer base.
Netflix's latest report to shareholders, which is where that data originates, claims the company has gained almost 9 million of these paying subscribers in the last three months of 2018 - closing out the year with 29 million more paying subscribers than it started with.
The streaming giant said the growth reflected the success of its original programmes. The service still has plenty of second-run programs, he said, but the momentum has shifted toward its original fare.
Bird Box wasn't the only show to use this footage, as it was also revealed that another production, the sci-fi drama Travellers, also contained images from the same rail crash.
Global original shows have helped to fuel the big overseas subscriber gains.
First quarter EPS and revenue miss could be attributed to the Street "mis-modeling" the recent price increase. The company said sales will be US$4.49 billion, compared with analysts' projections of US$4.6 billion. Netflix said in a letter to its shareholders on yesterday that it estimated the film will be viewed by more than 80 million member households in its first four weeks on the platform.
Raymond James' Justin Patterson maintains at Strong Buy, price target lifted from $450 to $470.
"Overall, 2019's off to a positive start", he said in a note.