These quarter results are the first after Netflix went truly global to 130 countries. During this quarter, Netflix added 6.74 million subscribers and it has been reported that 42 percent of its subscribers are outside the U.S.
This kind of news generally will send the share price high but the shares or Netflix have dived downwards because investors did not like the target of 2 million new customers during the next quarter. This is against the analysts expectation of 3.45 million. The Netflix stock was down 12 percent in the after hours trading.
Netflix added 5.59 million subscribers last quarter and a big majority (four fifth) of these were outside the US.
Today the company has reported 2.23 million new US subscribers which is better than the analysts expected target of 1.85 million. However, the company has expected that it will add just 500,000 new subscribers from US in the next quarter.
Netflix feels that its US market has matured over the years. It has also said that it is difficult to replicate the last year’s wins.
The company earned a revenue of $1.96 million in comparison with $1.57 billion during last quarter. The operating income for this quarter is $49 million which is down from $92 million last year. The decrease is because of the cost incurred on international expansion.