July 25, 2019
Netflix shares are on the rise again following a seven-day freefall that saw the SVOD pioneer’s stock plummet nearly 20% (or $26 billion) in value after posting disappointing Q2 subscriber growth numbers.
Shares closed July 24 up 3.5% to $317.94 per share — still a ways off the $362.78 valuation on July 17 when Netflix reported fiscal results.
Indeed, the service posted a loss 126,000 domestic subscribers after projecting growth of 300,000 subs. It was Netflix’s first domestic sub loss since 2011 when co-founder/CEO Reed Hastings announced – in an ill-advised tweet from home – the separation of the company’s legacy by-mail DVD rental business from its subscription streaming business.
Despite quickly cancelling the move following subscriber blowback, Netflix shares nosedived 75% in value.
The latest stock decline reportedly cost co-founder/CEO Reed Hastings, who owns 2.5% of Netflix’s stock, $850 million.
Before the drop, Netflix shares were up 35% year-to-date. The service expects to add 7 million subs in the current third quarter, which ends Sept. 30.
Separately, Netflix launched a mobile-only subscription plan in India for 199 Indian rupees ($2.89) monthly – less than half the service’s basic $7.23 plan. The SVOD service’s standard plan in India costs $9.41 and $11.58 for premium access.
The move comes after Netflix added just 2.7 million subs globally in Q2 – slightly more than half of the 4.8 million subs projected.