Netflix has reduced its international subscriber addition forecast for the second quarter, causing its shares to fall by 8% in after hours trading in the US.
Results published by the company forecast 2 million international net additions in Q2, compared to 2.37 million in the same period in 2015.
Meanwhile, the net additions in the US will amount to 0.50 million, compared to 0.90 million a year earlier.
In its latest set of results, the company says that the international forecast has been impacted by the Australia/New Zealand launch, which boosted growth in Q2 last year.
Excluding Australia/New Zealand, international net adds would be up this quarter, while sequentially they are down due to both standard seasonality and the launch in 130 countries at the beginning of Q1, which boosted take-up in the first quarter.
In the US, its net add forecast is in line with previous years, taking into account a modest impact from the beginning of un-grandfathering.
Netflix ended Q1 with total memberships of 81.50 million (62.27 million in Q1 2015), with 77.71 million (59.62 million) being paid. Total net additions in Q1 were 6.74 million (4.88 million).
In US, there were a total of 46.97 million memberships (41.40 million), of which 45.71 million (40.32 million) were paid.
Internationally, there were 34.53 million (20.88 million) paid memberships at the end of Q1, of which 31.99 million (19.30 million) were paid.
Netflix’s total revenues in Q1 amounted to $1,813 million ($1,400 million), with the contribution profit $309 million ($247 million). International contributed $652 million ($415 million), along with a loss of $104 million, compared to a loss of $65 million a year earlier.
Netflix notes that in most of the markets it expanded to at the beginning of 2016 the service is still offered only in English, with payment methods primarily limited to international credit cards. However, more local languages, content, payment options and customer support will be added in the coming quarters.
It also says that discussions continue on launching the service in China but there is “no material update on our approach or timing”.
