Anna Nicolaou reports for the Financial Times that Netflix is blaming less-than-expected subscriber growth in the United States on increased competition and its higher prices. She writes:
Netflix added 8.8m subscribers in the final three months of 2019, eclipsing its guidance for 7.6m and analyst forecasts for 7.9m. This was welcome news for the first quarter that the streaming group competed head-on with Disney and Apple, which launched rival services in November.
However in the US, its largest market, Netflix added only 420,000 subscribers in the fourth quarter — below its guidance for 600,000 and well behind the 1.5m it added in the same period a year ago.
Netflix blamed the US weakness on price increases last year and new competition from rival streaming launches. The company also warned that this softening in its home market would weigh on results for the current quarter.
Netflix shares were little changed in after-hours trading.
As the entertainment industry looks to streaming as the future of its business, the largest media companies are battling for market share in this new landscape. Traditional media groups Disney, Comcast’s NBCUniversal and AT&T’s WarnerMedia are all launching their own streaming services, bringing new competition to the market that Netflix pioneered.
Investors are concerned about Netflix losing steam in America amid the sea of new streaming options.
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