Record quarter for Netflix - Corona pandemic causes customer rush

The Corona pandemic and hit series like "Tiger King" have helped online video service Netflix to its strongest quarter. In the three months to the end of March, the number of paid subscriptions shot up by 15.8 million worldwide.

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This was announced by the streaming market leader on Tuesday after the US stock exchange closed. Netflix thus posted the quarter with its largest customer rush and far exceeded both its own forecast and the expectations of Wall Street analysts.

By the end of the quarter, Netflix had nearly 183 million paid memberships. Growth surged in March as people in more and more countries were told to stay home if possible because of the coronavirus, the letter to shareholders said. The company was also doing well financially, with revenue rising about 28 percent year over year to $5.8 billion. Profit more than doubled to 709 million dollars.

While many companies are suffering badly from the Corona crisis, Netflix is benefiting from the fact that many people are barely going out because of the virus. However, the company warned its investors that the boom is probably only temporary - with the end of the pandemic, growth is also likely to slow down again. In the second half of the year, Netflix expects year-over-year subscription numbers to fall. In the current quarter, the video service expects 7.5 million new customers.

 

Netflix on a roll

Netflix scored a big viral hit with the series "Tiger King", which was launched in March. The bizarre documentary about eccentric lovers of big cats such as tigers and lions was already viewed by 64 million user accounts in the first four weeks after its launch. Other productions such as the film "Spenser Confidential" or the new seasons of the crime drama "Ozark" and the Spanish series "Money Heist" also did well, according to Netflfix.

Founded in 1997 in Los Gatos, California, the company is riding one of the biggest waves of success in its history. On the stock market, Netflix's share price has already risen by over 36 percent this year - despite a general fall in the share price - and has recently broken new record highs. With a stock market value of just under 190 billion dollars, it has even overtaken US entertainment giant Walt Disney, which was still worth twice as much as Netflix in the winter.

Experts expect the surge to continue for some time. The stay-at-home era brought on by the viral outbreak should help Netflix extend its lead in the streaming market, says Credit Suisse analyst Brian Russo. The competition is not yet global enough to benefit from the trend to the same extent, he says.

Its big rival Disney+ is also booming - the week before last it announced that it already had 50 million paying subscribers just five months after its launch. However, in addition to popular productions such as the "Star Wars" series "The Mandalorian", Disney is also luring subscribers with low promotional prices.

The gap to Netflix is likely to remain large for the time being. While the market leader has been in business for over ten years and is represented in over 190 countries worldwide, the international expansion of Disney+ has only just begun. Unlike Disney, Netflix does not yet operate other business segments such as theme parks or cruises, which have been hit hard by the Corona crisis. (SDA)

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