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Why Netflix Failed to Meet Expectations?

  Why Netflix Failed to Meet Expectations? Netflix shares fell on Tuesday after the company reported a cooling increase in paid subscriptions that burned down during the pandemic. The broadcasting giant made a quarterly earnings announcement. The company said its revenue increased by 24 % in the first quarter of this year, compared to the same period in 2020, while paid memberships increased to 208 million. However, the new subscriber additions were about two million below Netflix's estimates. So what is the main reason Netflix's Q1 data is below expectations? "We've had a decade growing as smooth as silk," Netflix CEO Reed Hastings said in a earnings call. According to the company, production delays caused by the outbreak stopped running many original Netflix shows. Postponing these projects until the second half of the year caused the subscription numbers to fall short of expectations. Managers had predicted that there would be a large increase in subscribers in the pandemic compared to previous quarters. Likewise, the executives who spoke hopeful expressed that they expect the subscriber growth to accelerate again at the end of this year, when the continuation of successful projects will be published. "We continue to expect a strong second half, with the return of the new seasons of some of our biggest projects," the company said in a statement. According to the company, the transition from traditional television to streaming services like Netflix will continue to show a clear upward trend.

Netflix shares fell on Tuesday after the company reported a cooling increase in paid subscriptions that burned down during the pandemic.

However; The competition with Disney, Amazon and other giants is also getting fierce. "More and more new streaming services are being launched that are increasingly reinforcing our vision. This means linear TV will gradually be replaced by entertainment," Netflix said. "We think the long-term growth is stable," said Gene Munster of investment firm Loup Ventures, pointing to Netflix in his post on the subject. said. The Company also invests in shows made by non-US talents and predicts that "locally authentic stories" from around the world will resonate with viewers. The executives say that the continuation of many TV series that many large audiences are eagerly waiting for, will be released in the second half of the year and investments have been made for this.    

Source: Yahoo.Finance

 

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