This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Netflix's Stock Crumbles on Weak Streaming Guidance

NEW YORK ( TheStreet) -- Shares of Netflix (NFLX - Get Report) plunged in after-hours trading after the movie-streaming company said it expects weaker-streaming additions in the current quarter.

Netflix said that due to increased seasonality, it expects net additions to be below 2010's level. Netflix said it expects to have between 23.6 million and 24.2 million subscribers, implying growth between 200,000 and 800,000 streaming subscribers. It also expects second-quarter revenue to be between $873 million and $895 million, with the mid-point below the $895.11 million in revenue analysts are expecting.

The Los Gatos, Calif-based company said it expects an earnings loss of between 10 cents a share and 14 cents per share. Analysts polled by Thomson Reuters are looking for a loss of 17 cents per share.

The online entertainment company posted a first-quarter loss of 8 cents per share on $870 million in revenue. Analysts surveyed by Thomson Reuters had expected a loss of 27 cents a share on $866.93 million in revenue. The company had 26 million subscribers as of the end of the first quarter.

Netflix added 1.74 million domestic streaming subscribers and 1.21 million international streaming subscribers during the quarter. "We anticipate returning to global profitability in Q2, and plan to launch our next international market in Q4," CEO Reed Hastings wrote in his letter to shareholders.

"We are constantly improving our service with better personalization, better user-interfaces, better streaming, and more content," Hastings added. "As a result, per-member viewing hours set new records in Q1 and are on track to do so again in Q2, on a year-over-year basis. We launched our service in the U.K. and Ireland in January and are very pleased that, after the first 90 days, we had substantially more members than we had after the first 90 days of Canada or Latin America."

The CEO also touched on rivals, saying the biggest long-term competition comes from "TV Everywhere offerings." This includes HBO GO from Time Warner (TWX - Get Report) and Streampix from Comcast (CMCSA - Get Report), among others. He also cited Amazon (AMZN - Get Report) Prime and Hulu Plus as competition.

Shares of Netflix finished the regular session lower, off 4% to close at $101.84. Netflix stock plunged in extended-hours trading, down 16.29% to $85.25.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AMZN $659.59 0.00%
CMCSA $60.76 0.00%
NFLX $90.03 0.00%
TWX $75.14 0.00%
AAPL $93.74 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs