Netflix disappoints investors and the web TV stock sinks to Wall Street, where it lost up to 12% on Wednesday. The American giant closed the second quarter with 2,7 million more subscribers, about half of the 5 million expected by the market. Of particular concern is the loss of 130.000 subscribers in the United States due to price increases and weak programming. The crash also continued on Thursday: the stock began trading down by 10% and in the Italian afternoon it lost 11% to 322 dollars. This is the worst session for three years now. Compared to the capitalization of 158,5 billion dollars reached on Wednesday, the company has burned almost 16 billion in the first 10 minutes of the session and after an hour and a half of trading the value gone up in smoke is 17,6 billion.
The company counts on recovery in the third quarter when it expects to reach 7 million more subscribers driven by the return of the most successful series such as Stranger things and Orange is the new black. In fact, the greatest growth should come from the United States where 800 more subscribers are expected.
Despite disappointing subscriber growth, Netflix ended the second quarter with revenue up 26% to $4,92 billion. Profit, on the other hand, fell to $270 million from $384,3 million in the same period a year earlier. Earnings per share came in at 60 cents, above the 56 cents expected by analysts. For the third quarter, Netflix estimates revenue of $5,25 billion and earnings per share of $1,04.
The accounts are therefore positive even if the gaze of investors remains projected towards the future. From this point of view, however, analysts continue to forecast a positive second half of the year: both because the launch of the streaming services of Walt Disney, Apple and AT&T is awaited and this has already translated into the withdrawal from Netflix of some popular programs , such as The Office and Friends returning to Comcast's NBCUniversal and HBO Max respectively. In the letter to shareholders attached to the results, Netflix admits that it underestimated the effects of weak programming on subscriber growth. But he makes it clear that he does not want to go down the road of advertising to support his service.
Updated at 17:26 on Thursday 18 July 2019
