Shares in Netflix (NASDAQ: NFLX) were down substantially Tuesday as investors digested the company's latest quarterly earnings.
The stock was changing hands below at $98.32 U.S. a share on Tuesday, $10.08, or 9.3%, below Monday's close of $108.40 U.S. After stock markets closed on Monday, the company revealed it took in $1.96 billion U.S. in sales during the quarter, and turned a profit of $27.7 million.
The stock has traded within a 52-week range of $78.89 to $133.27 U.S.
Both figures were within range of what analysts were expecting, but investors focused on another set of numbers with a decidedly gloomier outlook.
The company said it expects to add 2.5 million new customers during the next quarter, a much lower figure than the almost-seven million customers it added during the first quarter.
Part of the reason for that is that after two years of grandfathering prices at $7.99, Netflix expects to hike monthly fees for many longtime users starting next month.
While the company may have the same appeal to new customers, analysts and even the company say that may cost them existing ones who won't be willing to pay the higher monthly fee of up to $11.99 for the company's premium package, the one that allows streaming on up to four devices at once in high definition.
Meantime, the company is also seeing its own costs rise as the costs to license content or produce its own are inching higher. Netflix expects to spend $6 billion U.S. on content this year, an increase from $5 billion in 2015.
Tech Insider
