Netflix Oz Success A Hard Act To Follow
Netflix shares have declined following the release of its first quarter results, with the SVOD giant forecasting a year-on-year decline in net international member additions in the second quarter, citing “a tough comparison” against last year’s Australia/New Zealand launch.
As reported by Reuters, Netflix shares declined 8 per cent in after hours trading on Monday.
Netflix reported that it had added a record 6.74 million subscribers in the first quarter, surpassing its previous best of 5.59 million in the 2015 fourth quarter, and up year-on-year from 4.88 million.
This was largely attributable to international additions of 4.51 million for the quarter, up from 2.6 million year-on-year, while US additions were 2.23 million, down from 2.28 million, with Netflix noting that of its 81.5 million members, 42 per cent are now outside of the US.
Netflix reported total revenue of US$1.96 billion for the first quarter, up from US$1.57 billion year-on-year, and net income of US$27.66 million, up from US$23.7 million.
Looking ahead to the second quarter, Netflix has forecast that it will add 2 million international subscribers, down from 2.37 million year-on-year, and 0.5 million US subscribers, down from 0.9 million.
Netflix stated that its international forecast “is due to a tough comparison against the Australia/New Zealand launch”.
Netflix noted that last year’s ANZ growth spike in the second quarter resulted in international net additions more than doubling year-on-year, stating that while ANZ is “growing steadily” this quarter two, it is less than last year’s launch spike.
Meanwhile, Netflix stated that its launch in 130 new countries at the beginning of the first quarter saw that quarter capture the initial surge of sign-ups.