At the close of Monday, Netflix released its reports on stock numbers and subscribers. Did they meet their goals? Yes and no. After being predicted to haul in 38 cents per share, Netflix pleasantly surprised us with a nicely rounded 40 cents per share. According to Los Angeles Times this puts them within their expected $2.64 billion in earning for this quarter. Strangely enough, Netflix is still having a little trouble reaching that 100 million-subscriber mark. What gives?
There’s also conflict in streaming investment advice (which is not terribly unusual, but will affect Wall Street all the same): Some consider Netflix a ticking bomb of investment; it could bust any day and is near cycling through its boom. Others say it will be a steady climb, though not as fast as before due to competition like Hulu and Amazon.
One particular group comes to mind when thinking about the future of streaming services: Millenials. Having been a key group in the creation and spread of binge-watching culture and as the nearest future investors of such services, a noticeable portion of Netflix’s success may depend on them. Some speculation has led to the thought that Millenials and the account-sharing trend is, ironically, slowing Netflix’s subscriber climb. Perhaps they don’t want to pay for it in the economic slump, so they use actual members’ accounts instead and create a profile. A feature that is highly attractive on Netflix accounts and has brought in a fair share of customers may also bring bad news for its future subscriber growth because potential users would rather share than pay the basic $7.99.
Despite this, CEO Reed Hasting claims that sharing is what gained them viewers last year in the final quarter, when it was definitely a growing trend, stretching beyond family to roommates, friends, and significant others. Perhaps as they get older and move into separate lives they will buy their own accounts.
It definitely isn’t loss of the appeal of the multi-viewer account, just sharing them that has affected subscriber growth, and that is perhaps why stock rises even in Netflix’s slowing of subscribers. People believe Netflix is stable and will be around for a long time, gaining previous account sharers as legitimate customers. The industry leader might have a slow and steady phase ahead, but their stats will also be swayed by their other latest players such as their massive investment in original shows and their reception and marketing.
Let us know what you think is swaying Netflix stats this quarter!
– Kelly Gatewood
Follow me on Twitter @asthewindrises
Image Source: LearnBonds