Video-streaming giant Netflix has reported a slowdown in subscriber growth, sending its shares tumbling.
About 3.98 million people signed up for Netflix between January and March, well in need of the projected 6 million.
The company said a scarcity of the latest shows may have contributed to the shortfall, adding that it expected this to recover as sequels to hit shows are released.
Netflix shares fell 11% in after-hours trading to $489.28, wiping $25bn off the company’s market capitalization.
The streaming service added 15.8 million new subscribers last year as Covid-19 forced people around the world to stay home.
Much of that growth came in Asia, where Netflix added 9.3 million new subscribers in 2020, a rise of about 65% over the previous year.
But the pandemic has proven a double-edged sword for Netflix because it also disrupted its production pipeline.
“These dynamics also are contributing to a lighter content slate within the half 2021, and hence, we believe slower membership growth,” the corporate said in its quarterly letter to shareholders.
The company projected poor customer growth ahead, with a further 1 million new streaming customers within the second quarter, far in need of the previously predicted 5 million.
Netflix also faces increasingly stiff competition from new streaming services entering the market.
Disney+, a way newer streaming service, already has 100 million subscribers, compared with Netflix’s 207.6 million.
Even with sluggish customer growth, Netflix has reported revenues of $7.16bn and a net of $1.71bn.
Netflix predicted stronger growth within the last half of the year when it releases new seasons of “You,” “Money Heist,” “The Witcher” and the action movie “Red Notice,” among other titles.
“We had those ten years where we were growing smooth as silk,” Netflix chief executive Reed Hastings said on a streamed earnings call, according to an AFP report.
“It is just a little wobbly right now.”