NFLX Netflix Inc

By Micah Maidenberg and Joe Flint 

Netflix Inc. beat its forecast for subscriber growth in the first quarter as consumers in many countries stayed at home due to the coronavirus pandemic and hunted for ways to entertain themselves.

The streaming giant said Tuesday it added 15.8 million new paid subscribers around the world in the quarter, more than double the 7 million new subscribers it had predicted for the period. In the first quarter a year ago, Netflix added 9.6 million new subscribers globally.

"Like other home entertainment services, we're seeing temporarily higher viewing and increased membership growth. In our case, this is offset by a sharply stronger US dollar, depressing our international revenue, resulting in revenue-as-forecast. We expect viewing to decline and membership growth to decelerate as home confinement ends, which we hope is soon," Netflix said in its letter to shareholders.

Shares were up 6% in after-hours trading. The stock is up 34% year to date, making the streaming service one of the few companies to see its shares appreciate since the coronavirus crisis started.

Most of the company's subscriber growth occurred outside of North America. Netflix said it added almost 7 million subscribers in the region including Europe and the Middle East, 2.9 million in Latin America and 3.6 million in Asia.

In the U.S. and Canada, where it faces more competition as other media companies launch their own streaming services, Netflix reported 2.3 million new paid subscribers, compared with a gain of 548,000 in the fourth quarter and 1.9 million in the first quarter a year ago.

In its shareholder letter, Netflix said its service has seen "significant disruption when it comes to customer support and content production." The company said it has added 2,000 remote agents to handle the surge in customer calls which are an offshoot of the increased demand for content.

Netflix said it generated revenue of $5.77 billion for the first quarter, up from $4.52 billion a year earlier. Analysts had forecast $5.75 billion in revenue for the latest period.

Profit rose to $709 million, or $1.57 a share, from $344 million, or 76 cents a share, the year earlier. The company was expected to earn $1.64 a share, according to estimates compiled by FactSet.

Write to Micah Maidenberg at micah.maidenberg@wsj.com and Joe Flint at joe.flint@wsj.com

(END) Dow Jones Newswires

April 21, 2020 16:46 ET (20:46 GMT)

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