Netflix added 9.6 million new subscribers in the first three months of the year even as it increased prices and faced stiffer competition from rivals including Amazon, Apple and Hulu.
The streaming video service now has nearly 149 million subscribers worldwide and beat analysts expectations in its latest earnings report. Its often volatile share price dipped slightly after the news broke, falling close to 1%, as US growth slowed. Since it went public in 2002 Netflix’s shares have increased about 29,000%.
The company said it would start testing weekly “Top 10” lists of its most popular content on its UK service later this year. The list will make it easier for “those who want to watch what others are watching”. If successful, the lists will be rolled out worldwide at a later date.
The results come as Netflix is facing increased competition. Apple and Amazon are both beefing up their media services, and this week AT&T, the telecoms and media company that owns Time Warner’s assets, sold its minority stake in rival streaming service Hulu. The move consolidates Disney’s control of Hulu and comes as AT&T is planning its own Warner streaming service.
Disney has a separate streaming service, Disney+, in the offing which will be aimed at a younger audience and plans to use Hulu for more adult fare. Hulu’s hits include the award-winning Handmaid’s Tale and Castle Rock, produced by JJ Abrams and based on characters and settings created by Stephen King.
The growing competition between the services is already hitting Netflix with some competitors, like Disney, pulling original programming, like the Marvel television shows, and reruns from its service.
“Both companies are world class consumer brands and we’re excited to compete; the clear beneficiaries will be content creators and consumers who will reap the rewards of many companies vying to provide a great video experience for audiences,” Netflix said in a statement accompanying its results.
Netflix spent $12bn on original content in 2018 and analysts expect that figure to top $15bn in 2019. This year the company has commissioned new seasons of some of its biggest series including Stranger Things, 13 Reasons Why and Orange is the New Black, as well as new films including Michael Bay’s Six Underground and Martin Scorsese’s The Irishman, which will star Robert De Niro and Al Pacino.
“We don’t anticipate that these new entrants will materially affect our growth because the transition from linear to on demand entertainment is so massive and because of the differing nature of our content offerings.”
Netflix’s results come after it announced a $2 price increase to $13 a month for US subscribers, its largest audience. Revenues for the quarter topped $4.5bn and the company reported a profit of $344m.
