Netflix recorded slow growth in its subscription base in the US in the last quarter of 2019, as it faced rising domestic competition from newcomers Disney+ and Apple TV+, which launched services in the market during the period.
In its financial report, the company said it attracted 420,000 new US subscriptions in Q4 2019, failing to meet its forecast of 600,000. Netflix stated this was “probably due to our recent price changes and to US competitive launches”, and pledged to combat these factors by improving its service.
It expressed confidence it will be able to keep up with increased competition from Disney+ and Apple TV+, which launched in the US in November 2019.
“We have a big headstart in streaming and will work to build on that by focusing on the same thing we have focused on for the past 22 years – pleasing members”, Netflix said.
The company confirmed its plans to continue testing mobile-only plans by expanding them to more countries, after seeing “incremental subscriber growth and improving retention” in the service which launched in Malaysia and Indonesia in Q4.
In December 2019 Disney+, which is set to become Netflix’s top rival, racked up 22 million downloads globally in its first month of availability, and on 21 January it announced plans for a broad European expansion.
Globally, Netflix added 8.8 million new paying subscriptions during Q4, surpassing its predicted 7.6 million, which it attributed to its “broad slate of original programming and the worldwide adoption of streaming video”. The additions took total paid memberships to 167 million, up from 139 million in Q4 2018.
Netflix predicted subscriptions would hit 174 million in the current quarter.
The company noted a 31 per cent year-on-year spike in its Q4 revenue to $5.5 billion, taking its full year total to more than $20 billion. Net income soared, from $134 million in Q4 2018 to $587 million.