Netflix shares plunged in after-hours trading on Monday after the US video service said it lost more US subscribers in the third quarter.
Netflix, which has seen a spate of management bungles in recent months, said it had 23.8 million subscribers in the United States at the end of the quarter, a loss of 810,000 from the previous quarter.
Netflix said net profit rose 65 percent to $62 million in the third quarter compared to the same quarter a year ago while revenue was up 49 percent to $822 million.
While revenue and earnings per share came in better than expected by Wall Street analysts it was the loss of US subscribers that sent Netflix shares down a whopping 26.91 percent in after-hours trading to $86.85.
Netflix appeared to be at the end of a second wave of cancellations by subscribers irked by a price hike, according to executives.
“We greatly upset many domestic Netflix members with our significant DVD-related pricing changes, and to a lesser degree, with the proposed-and-now-cancelled rebranding of our DVD service,” Hastings said.
“In doing so, we’ve hurt our hard-earned reputation and stalled our domestic growth,” he said.
Netflix on Monday announced plans to expand its online streaming service to Britain and Ireland in early 2012 but said it could lead to a net loss in the first quarter of next year because of costs associated with the move.
“We are eager to get back to our international expansion but we need to take a few quarters to get our subscriber base back,” Hastings said.
Great example of “If it ain’t broke, don’t fix it!” I loved Netflix until they started messing around with the prices and services. I cut my service to the lowest priced offering.