Netflix’s subscriber growth in the second quarter of 2019 fell way short of expectations as the streaming service’s domestic subscriber base shrank for the first time since 2011. That’s according to the company’s latest earnings report, which saw Netflix shares plummet in after-hours trading on Wednesday.
As the following chart illustrates, Netflix’s growth had increasingly shifted to international markets in recent years as the streaming giant expanded to more and more markets. In the most recent quarter, however, international subscriber additions also fell sharply, a fact that many observers attribute to the weak lineup of exclusive shows debuted over the past three months. At 91.5 million, Netflix’s international customers now account for 60 percent of the company’s paid subscribers, up from just 40 percent three years ago.
Wall Street closely watches Netflix’s subscriber growth because the company’s ongoing investment in content, both licensed and self-produced, will only pay off in the long run if its global subscriber base continues to grow. For the ongoing quarter, Netflix expects subscriber growth to rebound, forecasting 7 million paid subscriber additions globally until the end of September.