Netflix on Tuesday said it added almost 16 million new subscribers in the first three months of the year, nearly double the number that had been expected, as demand for the streaming TV giant’s services surged as consumers worldwide holed up at home due to the coronavirus pandemic.
Los Gatos-based Netflix grew its base of paid subscribers by 15.77 million during the first quarter, which blew the almost 8 million new members industry analysts expected Netflix to add. The vast majority of Netflix’s new members came from markets outside of North America, as the company said it added 2.31 million new subscribers in the United States and Canada.
Netflix said it ended the quarter with almost 183 million paid subscribers worldwide, and 69.97 million subscribers in the U.S. and Canada.
The company also benefited from the release of its hit show “Tiger King”, which Netflix said 64 million member households watched during the show’s first four weeks of release, as well as strong reception of its original movie “Spenser Confidential” starring Mark Wahlberg, and its new, unscripted dating show “Love Is Blind”.
In addition to its big gains in subscribers, Netflix also reported a profit of $1.57 a share, on $5.77 billion in revenue, compared to analysts’ forecasts for earnings of $1.64 a share, on revenue of $5.75 billion.
In a statement announcing its quarterly results, Netflix cited the coronavirus crisis as the driver for its massive gain in subscribers, saying it was “acutely aware that we are fortunate to have a service that is even more meaningful to people confined at home,” and that it can operate most of its business remotely and with little interruption.
“The company’s strong subscriber gains show that it’s the ultimate stay-at-home stock, following the coronavirus pandemic,” said Haris Anwar, senior analyst at financial markets platform Investing.com. “That said, there’s no guarantee that a global recession and increased competition won’t hit Netflix in the latter part of the year.”
And in anticipation of shelter-in-place rules being relaxed in the coming weeks and months, Netflix said to not expect a repeat of its huge first-quarter subscriber gains in the quarters to come.
“We expect viewing to decline and membership growth to decelerate as home confinement ends, which we hope is soon,” Netflix said.
Still, Netflix said it expects to add 7.5 million new subscribers in the second quarter, while analysts had earlier forecast the company to add 3.88 million subscribers during the quarter that ends in June.
