Netflix subscriptions "disappoint" and their shares fall on the stock market

Netflix added 5.2 million users in the second quarter about one million less than expected.

After the results report, the company's action collapsed when it fell to 15% to $ 342 in extended operations. During the year, the securities more than doubled until the close of this Monday.

The company's outlook for the current quarter also reflects a slowdown: the world's largest pay-TV network plans to add 5 million customers a higher rate slow than the year before.

Investors and badysts now have the task of to weigh if deceleration is an intermittent or longer-term problem . Netflix shares have reached record levels in recent months as investors believe the company will add tens of millions of customers globally over the next few years.

One reason for the deficit could be the lack of content. Netflix released a slender list of programs during the quarter, compared to its typical production. He has not offered new seasons of his greatest hits, such as Stranger Things and no new series has become a phenomenon. Since Netflix launched House of Cards the company has always included new seasons of original series to attract customers.

Netfllix released a new season of 13 Reasons Why and the Marvel Series Luke Cage as well as a special comedy, Nanette by Hannah Gadsby .

Love to cut?

New potential customers may also have been distracted by the World Cup, one of the most watched TV events in the world. Netflix, based in Los Gatos, California, did not say why it was down in the last quarter beyond the difficulty of predicting growth in 190 countries around the world.

Investors value Netflix at a much higher level than other media companies of similar size because of this potential for future growth. Your rating on the market has exceeded that of Walt Disney Co. this year, although reporting less than a quarter of revenue.

Revenues for the second quarter were also below expectations. Netflix recorded 3 thousand 910 million dollars compared with the average estimate of 3 thousand 940 million.

But the company takes an important step: international customers represent a larger volume of sales than domestic users.

Netflix, which was previously a service primarily for English speakers, increased its investment in content filmed in other languages ​​. The company debuted in its first Danish drama and the first Indian in the quarter, and plans to launch a new foreign language program at least once a week next year.

Profits were positive in the last quarter but not to rebadure investors. They rose to 85 cents a share, beating the badysts estimate of 79 cents.

"We had a strong quarter but not exceptional," the company wrote in a letter to shareholders.

High Costs

The production and promotion of a content library for a global audience cost a great deal . Netflix has repeatedly borrowed money to pay for its programming and is expecting to spend between $ 3 billion and $ 4 billion more than it will produce in 2018. Over $ 500 million was spent in the quarter, almost double what was spent a year ago.

The growth of Netflix has pushed other technology and entertainment companies to invest more in online video services. Disney sells an Internet version of its ESPN Sports Network and plans to introduce a general entertainment video service next year. Apple, meanwhile, spends more than $ 1 billion in original programming.

Netflix said Monday that it expects more competition, but ruled out any possible negative impact on its business. "Our strategy is simply to continue to improve, as we do every year," the company said.

Rob Arnott, director of Fund Research Research Affiliates, said on Bloomberg Television that the fall of Netflix will likely have a big impact on the indices. He was the second winner of the S & P 500 this year.

"There is an obvious risk of domino effect," Arnott said.

With the help of John Gittelsohn