Netflix predicts slower subscriber growth after record sign-ups in first quarter

By Megan Cerullo

/ MoneyWatch

Netflix added 9.6 million subscribers during the first three months of 2019 — its largest ever quarterly gain in viewers — but warned investors on Tuesday that its white-hot growth rate could soon cool off. The price of Netflix shares tumbled 4 percent on the news.

The streaming company expects to add just 5 million subscribers globally next quarter, down 8 percent from the 5.45 million it added during the same period a year earlier, the company said in a letter to shareholders Tuesday.

Still, the television and streaming service reached nearly 148.9 million total paid subscribers with the new additions in the first quarter, up from almost 139.3 million at the end of 2018. Netflix said it employed the same strategy it has always followed to achieve record growth: "When we please our members, they watch more and we grow more."

Trending News

But the company is less optimistic about growth for the second quarter. Netflix this month implemented price hikes in most of the countries in which it operates, testing customer loyalty, particularly as new services enter the streaming business at bargain prices. Disney last week announced its foray into streaming with Disney Plus — whose content Netflix will no longer have access to — for just $6.99 per month.

Netflix still licenses shows like "Grey's Anatomy" from other studios and has also ramped up investments in its own programming to produce series like "Stranger Things."

The company said it expects highly-anticipated films, including Martin Scorsese's "The Irishman" and Michael Bay's "6 Underground," to replace any subscribers it loses to price hikes.

Will Steven Spielberg get Netflix ousted from the Oscars?

Media analysts say there is room for multiple players and the streaming space doesn't yet appear to be too crowded. "The increasing number of streaming services with high-quality, exclusive content away from the legacy multichannel bundle appears to be making it easier and easier to cut the chord. That, in turn, frees up significant wallet share that helps all SVOD services," wrote BTIG research analyst Rich Greenfield.

Netflix also is in talks to purchase the historic Egyptian Theatre in Hollywood to allow its films to more easily compete for Academy Awards, after "Roma" director Alfonso Cuarón won Oscars for best director and best cinematographer. The Netflix-produced film also took home the award for Best Foreign Language Feature. Roma was eligible for Academy Awards because it had a short theatrical release before Oscar voting ended. Wildly popular Bird Box, on the other hand, was released direct-to-Netflix.

Netflix addressed head-on competition from new payers like Apple and Disney saying on Tuesday that it is "excited to compete." The company dismissed concerns that competition would hamstring its growth, citing the mass transition to on-demand entertainment that is currently underway.

"We believe we'll all continue to grow as we each invest more in content and improve our service and as consumers continue to migrate away from linear viewing (similar to how US cable networks collectively grew for years as viewing shifted from broadcast networks during the 1980s and 1990s)," the company said.

First published on April 16, 2019 / 5:02 PM

© 2019 CBS Interactive Inc.. All Rights Reserved.

Man accused of throwing boy from Mall of America balcony appears in court

The five-year-old plunged nearly 40 feet in Friday's attack, suffering massive head trauma and broken arms and legs

0M ago

"Game of Thrones" season 8 premiere draws record audience

The fantasy show's final season premiere had more than 17 million viewers watching the cable network

31M ago

Former Interior Secretary Ryan Zinke lands job at mining firm

Zinke says his work won't constitute lobbying

updated 38M ago

Qualcomm stock soars 23% on news it settled billion-dollar dispute with Apple

Apple and chip maker Qualcomm end bitter legal fight over technology that enables iPhones to connect to the internet

39M ago

7 sleep myths that could be affecting your health

These common misconceptions about sleep could be harming your health

50M ago

Former Interior Secretary Ryan Zinke lands job at mining firm

Zinke says his work won't constitute lobbying

updated 38M ago

DHS resuming "Remain in Mexico" policy for asylum seekers

The administration had halted the policy for a few days after a federal judge blocked the government from implementing it

1H ago

Bernie Sanders: Amazon, Netflix are a "disgrace" for not paying taxes

The senator took aim at corporations with zero-dollar tax bills while "millions of people today are paying actually more in taxes"

updated 34M ago

Roy Moore leads in Alabama Senate race poll

Moore narrowly lost in the 2017 special election as he was dogged by allegations of pedophilia

4H ago

Trump to skip White House Correspondents Dinner for campaign rally

In a break with tradition, the president has routinely skipped the White House press corps' biggest night of the year

4H ago

What was saved – and lost – in Notre Dame fire

While some priceless relics were lost forever in the flames, others were spared

1H ago

How to donate to repair Notre Dame after devastating fire

Donations are pouring in to start the arduous process of rebuilding the 850-year-old cathedral

1H ago

DHS resuming "Remain in Mexico" policy for asylum seekers

The administration had halted the policy for a few days after a federal judge blocked the government from implementing it

1H ago

Search for man and girl in Notre Dame photo goes viral

The sweet moment was captured just an hour before the tragic fire

3H ago

Why an expert says it could take 40 years to rebuild Notre Dame

Restoring the iconic French structure means replicating medieval building techniques and materials

1H ago

"Game of Thrones" season 8 premiere draws record audience

The fantasy show's final season premiere had more than 17 million viewers watching the cable network

31M ago

Millions tune in for "Game of Thrones"

In the age of Netflix, Amazon and Hulu, viewers have plenty of options. But there are still some shows that bring them together. John Blackstone explains.

55M ago 01:51

Deborah Norville "so grateful" after cancer surgery

The "Inside Edition" anchor admitted she had been "very fearful" because her doctor was forthcoming about the risks

1H ago

Mike Posner on his walk across America: "Your life is now"

Perhaps the "most un-famous famous musician," Posner's latest album reflects new maturity after a series of tragedies

3H ago

Pleading not guilty in college scam could be huge risk for Loughlin, others

A growing number of parents are pleading not guilty in the massive college admissions scandal

7H ago

Qualcomm stock soars 23% on news it settled billion-dollar dispute with Apple

Apple and chip maker Qualcomm end bitter legal fight over technology that enables iPhones to connect to the internet

39M ago

Wired reveals "tensions" between Instagram founders and Zuckerberg

"They have an impossible platform, huge problems, and crises they are not handling right – tough year," Wired editor-in-chief Nicholas Thompson says

4H ago

Wired reveals "hell" inside Facebook

A new Wired article reveals how Facebook navigated one of its most tumultuous periods. In the magazine's May cover story, "15 Months of Fresh Hell Inside Facebook," includes interviews with 65 current and former employees of the social media giant. Wired editor-in-chief and CBS News contributor Nicholas Thompson, who co-wrote the story, joins "CBS This Morning" to discuss the controversies. The article also explains why Instagram's co-founders left the company, six years after Facebook acquired the platform.

6H ago 05:16

Amazon touts effort to crack down on counterfeits amid complaints

Amazon showed us how approved sellers can identify and delete suspected counterfeit listings with just a few clicks

9H ago

Amazon touts counterfeit crack-down efforts

Amazon is speaking out about Project Zero, the company's latest effort to crack down on counterfeit goods sold on their site. The online retail giant has more than 300 million active users. They spent more than $141 billion on products last year. Carter Evans spoke with Dharmesh Mehta, Amazon's vice president of customer trust and partner support.

8H ago 05:06

3D-printed heart a potential breakthrough in making human organs

Not only are the cells alive, but all of the different cell types in the heart came from a single human donor

17H ago

Scientists say they 3D-printed artificial heart

There has been a potential breakthrough in making organs in the lab. Israeli researchers have 3D printed a heart, complete with muscle and blood vessels.

17H ago 00:55

Climate change protests stop traffic in heart of London

"Brexit, none of it's going to matter if there's a climate apocalypse," a demonstrator says

Apr 15

Last known female of world's rare turtle dies in China zoo

Yangtze giant softshell turtle was about 90 years old, but scientists tried again for artificial insemination shortly before her death

Apr 15

Arctic warming fuels blockbuster spring blizzard

What happens in the Arctic does not stay in the Arctic

Apr 12

7 sleep myths that could be affecting your health

These common misconceptions about sleep could be harming your health

50M ago

Deborah Norville "so grateful" after cancer surgery

The "Inside Edition" anchor admitted she had been "very fearful" because her doctor was forthcoming about the risks

1H ago

Deborah Norville "so grateful" after surgery

"Inside Edition's" Deborah Norville says she is grateful to the concerned fan who spotted a lump on her neck about 20 years ago. Two weeks ago, her surgeon removed most of her thyroid after nodules in her neck tested positive for cancer. On Monday, Norville was back on the air again. She joins "CBS This Morning" to discuss her experience and what people should do spot similar risks.

8H ago 04:39

Behind the latest spike in measles cases

The World Health Organization says measles cases rose 300 percent worldwide in the first three months of 2019, compared with the same period last year. New numbers from the CDC show 555 cases have been reported in the U.S. across 20 states this year. Measles is extremely contagious and can be deadly. Dr. David Agus joins "CBS This Morning" from Los Angeles to discuss the outbreak.

9H ago 02:36

3D-printed heart a potential breakthrough in making human organs

Not only are the cells alive, but all of the different cell types in the heart came from a single human donor

17H ago

Netflix warns investors of slower subscriber growth next quarter

Streaming giant says it added 9.6 million new subscribers in the first quarter, the company's largest gain ever

8M ago

Qualcomm stock soars 23% on news it settled billion-dollar dispute with Apple

Apple and chip maker Qualcomm end bitter legal fight over technology that enables iPhones to connect to the internet

39M ago

How to donate to repair Notre Dame after devastating fire

Donations are pouring in to start the arduous process of rebuilding the 850-year-old cathedral

1H ago

Bernie Sanders: Amazon, Netflix are a "disgrace" for not paying taxes

The senator took aim at corporations with zero-dollar tax bills while "millions of people today are paying actually more in taxes"

updated 34M ago

Wisconsin man's bet on Tiger won him more than $1.2 million

James Adducci risked $85,000 on the wager in Las Vegas, despite claiming he never placed a sports bet before

4H ago

Man accused of throwing boy from Mall of America balcony appears in court

The five-year-old plunged nearly 40 feet in Friday's attack, suffering massive head trauma and broken arms and legs

0M ago

Police: Suspect was offered $200 to beat transgender woman

Dallas police say Edward Thomas and others beat the Dallas transgender woman as others stood by and recorded video

1H ago

Pleading not guilty in college scam could be huge risk for Loughlin, others

A growing number of parents are pleading not guilty in the massive college admissions scandal

7H ago

Dozens of hidden graves discovered in Mexico, with volunteers' help

Gang and cartel-linked violence has left so many dead and missing that Mexican families often take on the grim search efforts themselves

10H ago

Man who threw boy from balcony went to mall to kill, police say

He was angry about being rejected by women at the Minnesota mall and has two past convictions for assaults there, court records show

10H ago

Space

Researchers reveal changes to astronaut's body

Retired astronaut Scott Kelly, who spent 340 days in space during an extended stay aboard the International Space Station in 2015-16, did not suffer any major long-term health effects that might raise warning signs for future long-duration flights, scientists reported Thursday. CBS News space consultant Bill Harwood joins CBSN with details.

Apr 11 01:08

Israeli spacecraft fails to land on moon

CBS News space consultant Bill Harwood speaks to CBSN about the failed moon landing and Thursday's other headlines: SpaceX's second launch of their Falcon Heavy rocket and NASA's report that astronaut Scott Kelly experienced biological changes during his year-long orbit in space.

Apr 11 05:36

SpaceX Falcon Heavy rocket thunders into space

The second flight of SpaceX's Falcon Heavy is carrying a Saudi communications satellite into orbit

Apr 11

Meet the 29-year-old who helped create the black hole image

Dr. Katie Bouman led the creation of a new algorithm to produce the first-ever image of a black hole

Apr 11

Israel fails to land spacecraft on the moon

An Israeli spacecraft has failed in its attempt to make history as the first privately funded lunar mission. The SpaceIL spacecraft lost contact with Earth late Thursday, just moments before it was to land on the moon, and scientists declared the mission a failure. Watch their announcement here.

Apr 11 01:05

Photos: Fire burns Notre Dame Cathedral in Paris

On April 15, 2019 flames erupted at the landmark cathedral, the most-visited landmark in the French capital

7H ago 46 photos

Star Wars Celebration 2019

The four-day convention for fans of the Star Wars saga, held in Chicago, included cosplayers, panels with the filmmakers, and the debut of the trailer for Episode IX of the series

Apr 13 39 photos

Awkward Easter Bunny photos

Children love the Easter Bunny – until they meet him

Apr 12 35 photos

The folk art of Bill Traylor

Born into slavery, the self-taught painter who began his artistic life in his 80s is the focus of a retrospective at the Smithsonian American Art Museum

Apr 7 24 photos

America's surprising food recalls

What's in your fridge? Just maybe salmonella, E. coli – and a dead bat?

Apr 5 36 photos

Popular

Millions tune in for "Game of Thrones"

In the age of Netflix, Amazon and Hulu, viewers have plenty of options. But there are still some shows that bring them together. John Blackstone explains.

55M ago 01:51

Measles cases on the rise in U.S.

According to the Centers for Disease Control and Prevention, there have been 555 cases of measles in the U.S. this year. That's the second-highest total for any year since 2000, which is when the disease was thought to be eliminated in the U.S. Dr. Neeta Ogden joined CBSN with more on the recent measles outbreaks.

1H ago 05:20

Freshman House Dem talks health care

Illinois Democratic Congresswoman Lauren Underwood spoke with CBS News report Grace Segers about health care plans and comparing nursing to being in politics.

2H ago 08:22

(Un)Welcome: Sweden's rise of the right

In this installment of CBSN Originals’ ongoing examination at how migration is reshaping the world, Adam Yamaguchi travels to Sweden to examine how a record influx of migrants has coincided with the recently welcoming and politically progressive nation's swift shift to the right.

Apr 15 23:06

What would it take to rebuild Notre Dame?

Donations to help rebuild Notre Dame Cathedral have been pouring in from around the globe. Kevin Murphy of Vanderbilt University joins CBSN to assess the significance and architectural loss of the Paris landmark.

1H ago 04:42

LEAVE A REPLY

Please enter your comment!
Please enter your name here