Netflix on Tuesday reported first-quarter revenue and earnings roughly in line with Wall Street expectations but offered a forecast below analyst estimates for the next three months.
Netflix shares plunged 7% in after-hours trading.
The streaming video pioneer began to reap the benefits of a crackdown on password sharing and the introduction of an ad-supported tier.
From January through March, Netflix posted diluted earnings of $2.88 per share, compared with Wall Street’s forecast of $2.86. The company posted revenue of $8.162 billion, in line with analyst estimates from Refinitiv.
Looking ahead, Netflix forecast $8.242 billion in revenue and $2.86 in diluted EPS for the second quarter. Wall Street had been projecting $8.476 billion for revenue and $3.05 for diluted EPS.
Netflix serves as a bellwether for the streaming industry, in which growth has slowed as competition has heated up.
The company added 1.75 million subscribers in the quarter, missing analyst estimates of 2.06 million additions.
A year ago, Netflix lost 200,000 subscribers — its first subscriber decline in more than a decade, sending its stock reeling and resetting Wall Street’s expectations for the sector.
[Written in collaboration with other media outlets with information from the following sources]
