Netflix’s recent record growth slowed considerably in the third quarter, with the company recording only 2.2 million paid net additional customers.
This, according to the company in its latest set of results, was 0.3 million fewer than projected and compared to the 6.8 million net ads in the same period last year and the 15.77 million and 10.09 million posted in the first and second quarters respectively of this year. Revenues in Q3 amounted to $6,436 million, up 22.7% on the same period last year, while net income was $790 million, up from $665 million in Q3 2019. All told, Netflix had 195.15 million paid memberships globally at the end of Q3, or 23.3% more than a year earlier.
Netflix notes that the APAC region was the largest contributor to its paid membership growth in the quarter (46% of Q3 global paid net adds) and APAC revenue rose 66% year-on-year. It says it is pleased with the progress its making in this region and, in particular, that it has achieved double digit penetration of broadband homes in both South Korea and Japan. While this is encouraging, it still has much work to do and is working hard to replicate this success in India and other countries.
Netflix is forecasting 6 million paid net adds for Q4 this year, compared to 8.8 million in the same period last year. This will put it a record 34 million paid ads for 2020, well above its previous record of 28.,6 million in 2018.
Commenting on growing competition, Netflix says that in this past quarter “we saw the debut of Comcast’s Peacock, which comes on the heels of the launch of HBO Max and Disney+. Disney’s recent management reorganisation signals that it is embracing the shift to streaming entertainment. We’re thrilled to be competing with Disney and a growing number of other players to entertain people; both consumers and content creators will benefit from our mutual desire to bring the best stories to audiences all over the world.
“We’ll continue to focus on pleasing our members and improving our service as quickly as possible so that we can be everyone’s first choice for online entertainment”.
