Netflix just revealed its financial numbers for the quarter that ended on June 30. For that three month time period the DVD rental-streaming video service has 25.56 million subscribers, up from 23.60 million subscribers from last quarter and well above the 15 million subscribers that Netflix has for the same time period a year ago. Revenues for the company came in at $789 million, up from $520 million in revenue from the same period a year ago. Net income came in at $68 million, up from $44 million from the same period a year ago.
Netflix also stated that nearly 75 percent of its new subscribers opted to get the streaming video only monthly plan which is $7.99 a month. The company also said that subscriber numbers for both its streaming and DVD rental plans declined in the last quarter, adding, "With the rapid adoption of streaming, DVD shipments for Netflix have likely peaked."
The company also discussed its recent decision to split its streaming and DVD rental subscriptions which resulted in a 60 percent increase for subscribers who have both plans. Netflix stated, "It is expected and unfortunate that our DVD subscribers who also use streaming don’t like our price change ... Some subscribers will cancel Netflix or downgrade their Netflix plans. We expect most to stay with us because each of our $7.99 plans is an incredible value. We hate making our subscribers upset with us, but we feel like we provide a fantastic service and we’re working hard to further improve the quality and range of our streaming content in Q4 and beyond."
Even though its DVD rental service may have peaked, Netflix also stated that it has no intention of selling it or shutting that division down. Indeed the company stated today, " ... we’ll also return to marketing our DVD by mail service, something we haven’t done for many quarters. Our goal is to keep DVD as healthy as possible for as many years as possible."
Netflix predicts that the current quarter will see 22 million of its uses subscribing to its streaming video service with about 15 million sticking with the DVD mail order rental service. 12 million Netflix subscribers should still stick with both the DVD rental and the streaming video service. Because of the price increase for the hybrid subscribers Netflix anticipates that it will see a slower growth in overall new subscriptions in the current quarter but adds that after that quarter ends it sees subscriber growth back on track in the fourth quarter of 2011.
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