Netflix's stock sinks as 2Q subscriber growth disappoints

Netflix shares dive after disappointing quarterly results

Modal Trigger Netflix CEO Reed Hastings Getty Images

Shares of Netflix plunged more than 13% Monday after the streaming giant reported second-quarter subscriber growth that missed Wall Street expectations.

"We had a strong but not stellar Q2", Netflix execs wrote in their quarterly letter to shareholders.

The numbers missed Netflix's own forecast for 1.2 million and 5 million domestic and worldwide subscriber additions, respectively.

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Subscriber additions: 5.2 million total - 1.1 million in the United States and 4.1 million internationally.

Membership in the quarter grew 5.2 million to a total of 130m, matching the same period previous year but a million shy of what Netflix forecast, according to a letter released along with earnings figures.

For the current quarter, the company is projecting revenue of $3.988 billion, below the consensus for $4.126 billion. Global subscriber net additions are projected at 4.35 million, again, below the average 5.095 million.

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Analysts had expected 79 cents on revenue of $3.94 billion.

The company also said it expects 5 million subscribers in the third-quarter, lower than Wall Street's expectations for 6 million. It marked the first time in a more than a year that Netflix hadn't exceeded its subscriber growth projections. The company will spend as much as $8 billion on programming this year.

Netflix already has been battling challenges from Amazon, Google's YouTube and Hulu in the video streaming market, and it is likely to face even stiffer competition as other formidable rivals try to muscle into the market.

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