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Netflix drops estimates based on economy

updated 12:55 pm EDT, Mon October 6, 2008

Netflix lowers estimates

Subscriber numbers for Netflix are on a slight decline, the company has announced. The movie rental outfit says that in figures for the third quarter of the year, it recorded only 8.672 million subscribers, below predictions of 8.675 to 8.875 million. Final revenue figures, which will be announced on October 20th, are expected to end up between $343 and $348 million. CFO Barry McCarthy notes that while July subscriber growth was fine, it dropped significantly in August, only to resume growth in September.

The company foremost blames worldwide economic problems, which may have led to people canceling subscriptions or choosing not to join. Netflix is also faced with increasingly stiff competition, particularly from digital services such Amazon's Unbox and the Apple iTunes Store. The company has however announced expanded online streaming options, including Macs, Xbox 360s, and content from Starz.




by MacNN Staff

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Comments

  1. njfuzzy

    Joined: Dec 1969

    +3

    Interesting

    This makes sense to me. I recently dropped NetFlix, simply because I am trying to cut monthly fixed expenses, and it was an easy cut to make. I suspect they are seeing other people make the same sort of decision.

  1. handydan

    Joined: Dec 1969

    0

    Oh

    I wonder if the loss in numbers has anything to do with the shoddy service? I believe they have had a couple of major computer system failures or crashes lately resulting in long shipping times, I know personally our ship times can take as long as 4 or 5 days on more than one occasion. However I am looking at getting the ROKU too.

  1. Guest

    Joined: Dec 1969

    -2

    Gee...

    Wasn''t their big system outage back in August? Hardly the sort of press you want to attract new customers. Because of that snafu and other inconsistencies in their service of late, I dropped my subscription in September as soon as my current month ran off.

    Bad service=fewer customers. But I'm sure Netflix won't be the last company to say the problem was due instead to a global economic downturn. Much less blame for themselves that way...

  1. eldarkus

    Joined: Dec 1969

    +2

    weird...

    I have been a Netflix member for over 2 years now and the only issue I had was a bad disk one time.. filled out the online form and got another one within a day or so.

  1. boomer0127

    Joined: Dec 1969

    +1

    my subscription

    is on hold while I move - I will probably cancel if the mac version of the instant movie viewer is not ready in two months.

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