Netflix reported a loss in 2019 second quarter earnings and new subscriber count of 2.7 million, far below the target of 5 million. It was rumored to be due to the new competition the streaming TV faces in the form of Disney, HBO and Apple.
U.S. subscriber count dropped by 126,000, which was unexpectedly below expectations of 352,000 new subscribers. In global terms, Netflix grew their global audience to about 2.82 million, which was lower than expected (4.81 million).
Reed Hastings, Netflix CEO reported that subscriber loss was probably due to forcing increased monthly costs for the service. The loss of The Office and Friends, Hastings mentions frees up the company to create more original content.
There are rumors that suggest Netflix will be adopting an ad-based model to keep the fees low, but Hastings has stated that won’t be happening. The 2019 Q2 report is the first time Netflix posted a loss, but it’s optimistic that there’s still room to grow.