Netflix Execs Play It Cool After Stock Plunges On Slower Sub Growth: “It’s Not A Straight Line. We Are Just Staying Calm”
The Netflix team played it cool Thursday as CFO Spencer Neumann attempted to reassure Wall Street that “there’s no structural change in the business that we see.”The company’s shares had plunged 20% in after-hours trading earlier Thursday, pulling media stocker down.
Execs speaking on a post-earnings video Q&A shrugged off the slower than anticipated subscriber growth that triggered the drop, saying they can’t explain it but it’s no flashing red light.Fourth numbers were good with a small miss on subs but a bigger slowdown anticipated for the current first quarter (2.5 million net adds) that fell short of Wall Street models and sparked jitters that streaming, at the industry leader and maybe across the board, is challenged.“We’re trying to pinpoint what that is, why our growth hasn’t recovered to pre-Covid levels.
We can’t pinpoint it,” Neumann said. Competition is growing, however data doesn’t show that’s a problem, he said. There’s a grab bag of reasons for what is.
Big titles landing a bit later in the three months ending in March; the quarter reflecting a price increase in the U.S./Canada – its largest region; Latin America remaining a strain (macro factors and the fact that pay TV is still very big).“It doesn’t feel like any qualitative change,” agreed founder and co-CEO Reed Hastings.
