Netflix has added millions of new subscribers to its streaming service in Q3, though it did miss its goal — a result that could worry investors as the streaming giant braces for a slew of new competitors in the coming months, though the company is confident it its future.
According to a new report from CNBC, the entertainment streaming company signed up 6.8 million new subscribers to its monthly service in the third quarter of the year, an improvement on the previous three months, when it recorded its slowest growth for three years and sent shares tumbling.
Netflix’s Q3 subscriber growth was aided by a relatively strong slate of content releases including Stranger Things season 3 — which the company said was the most-watched season to date with 64 million member households viewing it in its first four weeks — and the seventh and final season of Orange Is the New Black. The company claimed its third-quarter subscriber forecasts were its most accurate in the recent past.
For Q4, Netflix is forecasting 7.6 million global paid net adds, with 600,000 in the U.S. and 7.0 million for the international segment. Analysts had been pegging Netflix to add as many as 9.3 million net new paid subscribers (2 million U.S., 7.3 million overseas).
However, Netflix said it expects growth in the fourth quarter to decline year-on-year as Apple and Disney enter the market, meaning that subscriber growth will decline in 2019 for the first time in recent years.
Both Apple and Disney are launching cheaper rivals to Netflix next month, in a major escalation of the video streaming wars.
“The launch of these new services will be noisy,” Netflix said in a letter to shareholders. “There may be some modest headwind to our near-term growth.”
The note wasn’t lacking in confidence, though, stating “We did well during the first decade of streaming. We’ve been preparing for this new wave of competition for a long time. It’s why we started investing in originals in 2012 and expanded aggressively ever since – across programming categories and countries with an ambition to share stories from the world to the world.”