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Netflix Loses 810,000 Subs

Netflix Inc. (Nasdaq: NFLX) stock plunged more than 21 percent Monday after the company reported losing 810,000 subscribers in the third quarter when it blundered through rate hikes and a temporary decision to split off its DVD business. (See How Far Will Netflix Fall? , Netflix Kills Qwikster, Netflix Chops 1M Subs From Q3 Forecast and Netflix Rate Hikes Will Hammer Growth.)

Netflix ended the quarter with 23.8 million subs, down from the 24 million that the company had forecast. Broken down, Netflix ended the past quarter with 21.45 million streaming subs and 13.9 million DVD subscribers, down from an expected 21.8 million streaming subs and 14.2 million DVD customers.

Netflix's third-quarter financial story was a better one, as it posted earnings of $1.16 per share on revenues of $822 million, more than the $1.05 per share and $812.50 that analysts were expecting.

But Netflix also warned of a tough fourth quarter, at least when it comes to its DVD business. "We think DVD subscriptions will decline sharply this quarter ... due to our price changes," the company said in a letter (PDF) to shareholders. "Nevertheless, we do anticipate that total unique U.S. subscribers will be slightly up in Q4."

Netflix shares were down $25.93 (21.82%) to $92.91 in after-hours trading Monday.

— Jeff Baumgartner, Site Editor, Light Reading Cable

Jeff Baumgartner 12/5/2012 | 4:50:37 PM
re: Netflix Loses 810,000 Subs

Netflix shares are down $43.33 (36.46%) to $75.51 in early trading Tues. following Netflix's release of Q3 numbers on Monday afternoon.  Netflix continues to get hammered over customer reactions to the price hikes and original Qwikster plan and its Q4 guidance, but does this seem like a market over-reaction? JB

shygye75 12/5/2012 | 4:50:37 PM
re: Netflix Loses 810,000 Subs

Bubble stocks tend to defy logic -- both ways.

AESerm 12/5/2012 | 4:50:36 PM
re: Netflix Loses 810,000 Subs

Apt note about bubbles and logic. Earnings were $62.5m vs. $38m last 3Q. That's a big jump. More important is what to call Net Flixters who cut their virtual cord to the service.

shygye75 12/5/2012 | 4:50:36 PM
re: Netflix Loses 810,000 Subs

Flix-offs?

AESerm 12/5/2012 | 4:50:34 PM
re: Netflix Loses 810,000 Subs

I like both. But laugh-o-meter registered higher with Flix-offs earlier today. Today's 35% drop (No-flix) is no laughing matter. Some clever people were shorting this stock earlier this year, so maybe they saw this coming.

craigleddy 12/5/2012 | 4:50:34 PM
re: Netflix Loses 810,000 Subs

How about: No-flix. A 35% stock drop today. Six months ago the pay TV world was shaking in its boots over Netflix. Who knew they'd become their own worst enemy? 

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