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Netflix’s Stocks Plummet with Failure to Reach Projected Goal

Although Netflix’s stock market was doing well in 2015, it seems like consumer growth is at a crawl. On Monday, stocks for Netflix diminished by 15% due to Netflix’s lack of subscriber growth. Netflix gained 160 thousand subscribers in the U.S. and 1.52 million overseas. Unfortunately, this did not meet Netflix’s hope of 200,000 new subscribers regionally and 2 million abroad.

These subscriber counts are significantly less from years before. In 2014, Netflix gained 13 million subscribers. In 2015, another 17 million subscribers were added. Some speculate that Netflix explosive growth in the last two years was due to Netflix’s expansion into 130 new countries.

Netflix wasn’t wrong about the increase of subscribers, but badly underestimated the number of subscribers that unsubscribed.

Netflix recently increased their subscription price by $2 from $7.99 to $9.99. Netflix suspects that long-time subscribers that were used to paying $7.99 were discouraged by the price spike.

Netflix doesn’t regret increasing the subscription price. They believe that increasing prices will help them in them in the long run. By increasing the prices, the increased revenue will help Netflix bring its customers more content and improve streaming services.

Despite the plummet in Netflix shares, many investors still have high hopes of Netflix shaping the TV industry.

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