Netflix stock is plummeting after it missed subscriber targets by nearly 1M

Via highspeedinternet

This sent Netflix shares tumbling 12.6% (at time of this posting) in after-hours trading.

The streaming company said it had added 5.2 million subscribers in the three months to June 30, below analyst forecasts for 6.3 million subscribers and its own expectations. It now has about 130 million worldwide.

Chief Executive Reed Hastings, in a letter to shareholders, called it a "strong but not stellar Q2".

Netflix said it made a profit of $384m on revenue of $3.9 billion in the recent quarter, compared to net income of $66m on $2.8bn in revenue in the same period a year ago. The stock is now down by over 13%, after it significantly missed subscriber targets.

Analysts had been modeling $3.94 billion in revenue and EPS of 79 cents. Global subscriber net additions are projected at 4.35 million, again, below the average 5.095 million.

"This isn't entirely surprising given rising competition in the video streaming market, where Amazon, Hulu, HBO and others are gaining share of subscription video dollars at Netflix's expense", he added. As Yahoo Finance previously reported, Netflix plans on spending roughly $2 billion on original content for 2018 - 25% of the $8 billion it spends on all content.

The news could end a rocket ride for Netflix's stock price, which has more than doubled over the past year.

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