Netflix has reported a huge rise in subscribers, the streaming service benefitting from demand for entertainment during coronavirus lockdowns.
10.1 million new subscribers signed up between April and June, triple the typical growth for the period. In the first half of the year 26 million paid subscriptions were added, nearly on par with the 28 million achieved in all of 2019. Netflix now has 193 million subscribers worldwide.
The figures include a small amount of subscribers that had their memberships cancelled due to recent inactivity.
However, in its Shareholders Letter, Netflix cautioned that it did not expect to see the growth continue into the third quarter. It believes many of the subscriptions have been “pulled forward” from later in the year. The company is forecasting new subscribers of 2.5 million for Q3 20, well below the 6.8 million for the same period in 2020.
“Worrying times do lie ahead for Netflix, as disconnections are inevitable which will negatively impact its bottom line,” said Paolo Pescatore, Tech, Media & Telco Analyst, PP Foresight. “Its overseas markets will continue to attract new subs thanks largely to its successful partnership strategy with local telco and TV providers. Also, local broadcasters around the world will struggle to create big blockbusters due to cost reductions and a drop in advertising revenue. Therefore, a key focus will be on subscriber retention. While, having a broad content catalogue will put it in good stead, a slate of new shows will be paramount.”
Meanwhile, chief content officer Ted Sarandos has been appointed co-CEO and elected to the Netflix Board of Directors.
“Ted has been my partner for decades. This change makes formal what was already informal – that Ted and I share the leadership of Netflix,” said the now co-CEO Reed Hastings.
