Netflix adds record-breaking 9.6M subs in Q1

Netflix added its highest quarterly paid net adds in the history of the streaming service in Q1 2019, up 9.6 million – a year over year increase of 16% – bringing its total number of subscribers worldwide to 148.9 million.

Broken down, 1.74 million of those new subscriptions were in the U.S. and 7.86 million international, setting a new quarterly record. The streaming giant is predicting it will add another five million net subscribers in Q2, which would bring the service to 14.6 million paid net adds for the first half of 2019.

Revenue surpassed 4.5 billion in Q1, with total revenue growth year over year at 22%, compared against 40% in Q1’18.

Netflix says it’s currently working through a series of price increases in the U.S., Brazil, Mexico and parts of Europe. Similar to what it experienced following a similar price increase in Canada, Netflix says so far gross additions are unaffected, with some modest
short-term churn as members consent to the price change.

“We’re looking forward to a strong slate of global content in the second half of the year, including new seasons of some of our biggest series, Stranger Things (July 4th), 13 Reasons Why, Orange is the New Black, The Crown and La Casa de Papel (aka Money Heist) as well as big films like Michael Bay’s Six Underground and Martin Scorsese’s The Irishman, and expect another year of record annual paid net adds in 2019,” reads Netflix’s quarterly letter to shareholders.

With recent announcements surrounding the coming launch of both the Apple+ and Disney+ streaming services, Netflix says it’s “excited to compete; the clear beneficiaries will be content creators and consumers who will reap the rewards of many companies vying to provide a great video experience for audiences.”

“We don’t anticipate that these new entrants will materially affect our growth because the transition from linear to on demand entertainment is so massive and because of the differing nature of our content offerings. We believe we’ll all continue to grow as we each invest more in content and improve our service and as consumers continue to migrate away from linear viewing (similar to how U.S. cable networks collectively grew for years as viewing shifted from broadcast networks during the 1980s and 1990s).”

“We believe there is vast demand for watching great TV and movies and Netflix only satisfies a small portion of that demand. Last quarter, we talked about how our streaming hours in the U.S. (our most mature market) on TV still only represents roughly 10% of total TV usage. We are much smaller and have even more room to grow in other countries and on other devices like mobile,” states the letter.

Netflix stock closed the market up 3.04% to $359.46 USD.

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