FILE PHOTO: The Netflix logo is seen on their office in Hollywood, Los Angeles, California, U.S. July 16, 2018. REUTERS/Lucy Nicholson
(Reuters) – Netflix Inc (NFLX.O) posted lower-than-expected quarterly quarter revenue on Thursday, despite a slate of original content the streaming pioneer released in the quarter including hit thriller “Bird Box”, sending its shares down 3 percent.
The company said it added 8.84 million paid global streaming subscribers in the fourth quarter. It said it expects global paid streaming net subscriber additions of 8.90 million in the current quarter.
Analysts had expected 9.18 million net global streaming additions for the fourth quarter and 7.64 million additions for the current quarter, according to IBES data from Refinitiv. It was not immediately clear if analysts were excluding unpaid additions.
Netflix, which raised prices for most U.S. subscribers by $2 a month earlier this week, said total revenue rose 27.4 percent to $4.19 billion. Analysts on average had expected revenue of $4.21 billion.
The company has been adding subscribers at a good clip, fueled by a ramped up spending on original content. The company had said it planned to spend $8 billion in 2018, $1 billion more than 2017, on creating original content.
The additions come against the backdrop of intensifying competition in the streaming services space. AT&T (T.N) and Walt Disney Co (DIS.N) plan to launch their services later this year, joining a field that currently includes Amazon.com’s (AMZN.O) Prime Video service and Hulu.
But the aggressive spending on content has been accompanied by a doubling of the company’s debt, to $6.50 billion in 2017 from $3.36 billion in 2016.
Net income fell to $133.9 million, or 30 cents per share, in the fourth quarter ended Dec. 31, from $185.5 million, or 41 cents per share, a year earlier.
Analysts on average were expecting 24 cents per share.
Reporting by Vibhuti Sharma in Bengaluru; Editing by Sriraj Kalluvila