US streaming subscribers number falls short of Netflix’s expectations

24 Oct 2012

Netflix's headquarters in Los Gatos, California

Even though the number of Netflix’s US streaming subscribers increased in the third quarter, it fell short of the company’s expectations.

Netflix reported the addition of 1.2m US streaming subscribers, for a total of 25.1m domestic streaming subscribers. This is an increase from 21.4m in the year-ago period.

The company had expected to end the quarter with 24.9m- 25.7m such subscribers.  

The TV and film subscription service reported a third-quarter net profit of US$8m, or US$0.13 a share, on revenue of US$905m.

The company’s revenue increased 10pc from the US$821m from the year-ago period.

Internationally, Netflix added nearly 0.7m international streaming subscribers, ending the third quarter with 4.3m international members.

“We are currently over 1m members strong in the UK and Ireland and continued to see strong growth in Q3,” Netflix CEO Reed Hastings and CFO David Wells said in a letter to investors.

“The UK/Ireland market is expensive for content due to the competition with Sky and Amazon LOVEFiLM. We are very happy to be ahead of LOVEFiLM, and intend to continue to expand our content and grow our members rapidly.

“As we expected, the UK/Ireland market will take materially longer than Canada to get to profitability, given the high level of competition and the continued expansion of our content,” Reed and Wells said.

Tina Costanza was a journalist and sub-editor at Silicon Republic