Netflix added 1.54 million customers in the second quarter of 2021, above 1.12 million analyst expectations and estimates of 1 million.
However, this is the slowest start to a year for Netflix since 2013, when it was operating in less than half of the countries it is currently in.
Customers are watching less TV shows this year on average than in 2020 in the face of pandemic weakness, which the company justified as part of its second-quarter financial report published Tuesday.
“The pandemic has disrupted our growth extraordinary and distorts comparisons year after year,” he stated in a letter to his shareholders.
Two regions, Latin America and Asia Pacific, accounted for nearly all of the subscriber growth in the second quarter. These are the two smaller areas of the company.
The service lost 430,000 customers in its largest region, the United States and Canada, the first time it had contracted in two years.
Netflix has blamed its slow growth on a combination of factors: the pandemic, seasonality, and a thin slate of popular shows. The service had fewer major offerings to deliver in the first half of this year, in part due to production delays in the early months of the pandemic.
The ratings for two of his most popular shows, “Lupine” and “Too Hot to Handle”, have also fallen from previous seasons.
“Covid-19-related production delays in 2020 lead to the lighter first half of 2021 that will unfold throughout the year,” the company said.
The company has raised new concerns about slowing growth in a post-COVID-19 world, with the latest subscriber expectations coming in well below Wall Street estimates.
The broadcast giant reported that new customer subscriptions will be 3.5 million in the third quarter, compared to 5.86 million analysts had expected.
The world’s largest streaming service has warned that 2021 will start slowly, after record growth a year ago. The company registered nearly 26 million new customers in the first half of 2020, as people who stayed home during the pandemic flocked to its movies and shows.
Investors initially pushed the stock down 6.6% in response to the news, but concerns quickly subsided and the stock changed little in extended trading.
Netflix stock is up 67% in 2020, although that rally has failed this year. Paper fell 2.3% during the first six months of 2021, the worst first half since 2016.
A stronger slate of new series in the second half of this year could help boost registrations. His upcoming releases include new seasons of “La Casa de Papel” and “The Witcher,” two popular shows. The company registered 2.2 million new customers only in the third quarter of last year.
With the aim of extending its long period of growth, Netflix is looking at video games as a magnet for existing and potential customers. The company will add games to its streaming service in the next 12 months, and its first games will be designed for mobile devices. It’ll start out as a test, but it’s still an expansion into a whole new kind of entertainment.