Netflix says the opportunity ahead remains “gigantic” despite a slowdown in subscriber numbers, including international markets.
In the first quarter the streaming service passed $2.5 billion in revenues and added another 5 million members.
4.95 million new subscribers were added in the quarter, fewer than the 5.2 million forecast.
Although Netflix is far from a one trick pony, the move of House of Cards from Q1 to Q2 has impacted on operating margins, which rose to 9.7% in the first quarter. Netflix is now forecasting operating margin at 4.4% in Q2, placing it on track to reach its 7% target for the full year.
In turn the number of net additions have fallen; Netflix now expects to have 8.15 million net adds, compared to 8.42 million net adds in the first half last year.
International net additions have fallen 22% year on year, though revenues in the international segment grew 62% on the year.
A “small, but steady” segment has migrated to the our 4-stream, 4K-UHD-HDR video quality tier.
The much-publicised moved to “thumbs-up thumbs-down” feedback has resulted in twice as many ratings.
A future improvement within the UI is to replace still images with moving video.
