Netflix sinks as its subscriber growth forecast fell below estimates

Netflix

Netflix has reported its fourth quarter results. The stock was down 11.82% in Thursday’s late trading to $448.15 per share after Netflix’s subscriber growth forecast came in below analyst estimates.

Netflix beat forecast for earnings. It earned a $1.33 per share. $0.88 was expected.

Netflix reaped $7.71 billion in revenue. $7.71 billion was expected.

Netflix also reported more subscriber additions at 8.28 million. 8.13 million was expected.

While Netflix’s Q4 was not short of market expectations, its shares were weighed down by a disappointing outlook for subscriber growth.

The company said it expects to add 2.5 million subscribers in Q1 2022, compared to 3.98 million during the first quarter last year.

Netflix hit a downtrend in 2021 as “stay at home” trades faded in popularity as investors anticipated a growing number of people returning to in-person activities as the economy reopens and COVID-19 unwinds.

Netflix underperformed the S&P 500 last year as subscriber growth decelerated after a strong 2020 that saw streaming players benefit from lockdowns with more consumers at home.

In the third quarter, Netflix saw 4.38 million sign-ups. Although the closely-watched figure beat analyst estimates, the number came in far below the record 25.9 million additions in the first half of 2020.

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