SAN FRANCISCO: Video streaming giant Netflix has added 15.8 million subscribers in the first three months of 2020 which is a growth of 22 per cent (year-over-year), registering quarterly revenue of $5.77 billion.
Netflix now has over 182 million subscribers worldwide.
The positive results, despite the continued COVID-19 pandemic and fluctuating US dollar, saw Netflix stock up 3.3 per cent in early after-hours trading.
"In our history of more than two decades, we've never seen a future more unpredictable or unsettling. The virus has infiltrated every corner of the planet and, in the absence of a widespread treatment or vaccine, no one knows how or when this terrible crisis will end. What's clear is that the escalating human cost in terms of lost lives and lost jobs, with tens of millions of people now out of jobs," the streaming giant said in its letter to the shareholders after announcing the quarter results late Tuesday.
The letter released by the company also said, "In this company, we are avidly aware that we are quite lucky to have the kind of service which has become even more useful for millions of people under isolation and quarantine. We are able to operate it remotely and it has disruption of the minimal level when it comes to short to medium term."
Like other home entertainment services, Netflix is seeing temporarily higher viewing and increased membership growth.
"In our case, this is offset by a sharply stronger US dollar, depressing our international revenue, leading to revenue-as-forecast," said Netflix.
"While our productions are largely paused all over the world, we enjoy an outsized pipeline of content that was either complete and prepared for launch or in post-production when filming stopped," the letter further said.
"So, while we're certainly impacted by the worldwide production pause, we expect to still be ready to provide a terrific variety of new titles throughout 2020 and 2021."
Netflix acknowledged that there are three primary effects on its financial performance from the crisis.
"First, our membership growth has temporarily accelerated because of home confinement.
"Second, our worldwide revenue is going to be less than what was previously predicted as the dollar is rising sharply. Third, as the production has faced a temporary shutdown, some cash spending on content is going to be delayed, improving our free cash flow, and some title releases are going to be delayed, typically by a quarter,' it elaborated.