Netflix missed its fourth-quarter forecasts by narrow margins, adding 8.3 million subscribers globally, vs. predictions of 8.5 million, and generating $7.09 billion in revenue, up 16% year over year (vs. guidance of $7.12 million).
Still, coming off a quarter in which it launched its most successful show of all time, Squid Game, and two of its most popular movies ever, Red Notice and Don't Look Up, Netflix sent investors running for the exits, predicting Q1 growth of just 2.5 million subscribers. (Netflix added 4 million subscribers in the first quarter of 2021.)
As of 4:45 p.m. EST, the company's stock is down nearly 18.5% in after-hours trading.
For the full 2021, Netflix grew "paid net adds" (i.e. customers) by 18 million globally, vs. 37 million in the quarantine-fueled 2020. But growth in the U.S. and Canada was actually bigger in 2021 -- 1.2 million vs. 900,000 in 2020.
Netflix ended 2021 with 221.8 million paid customers globally, making it far and away the world's biggest streaming service operator.
In its quarterly shareholder letter, Netflix acknowledged increased competition, with Apple TV Plus, Disney Plus, Peacock, HBO Max, Discovery Plus and Paramount Plus all launching over the last two years.
"Consumers have always had many choices when it comes to their entertainment time -- competition that has only intensified over the last 24 months as entertainment companies all around the world develop their own streaming offering. While this added competition may be affecting our marginal growth some, we continue to grow in every country and region in which these new streaming alternatives have launched," the letter stated.
Netflix just announced its first price increase in over a year, raising the price of its most premium tier to $20 a month. ■
