Increased competition weighs on Netflix.
Although the fourth quarter closes above analysts' expectations, the streaming TV giant sinks to Wall Street, losing over 10%.
Stocks are penalized by the estimates for the first three months of the year, which are lower than the market forecasts for subscriptions, profits and revenues.
"Consumers have always had many choices on the entertainment front. Over the past 24 months, competition has intensified with companies developing their own streaming platforms. While competition can have an impact, we have continued to grow in all countries and regions where these new platforms have been launched, "says Netflix. Thanks to the 'Cobra Kai' series and the film 'Don't Look Up' with Leonardo di Caprio and Jennifer Lawrence, the streaming TV giant closed the fourth quarter with revenues up 16% to 7.71 billion dollars and earnings per share up to $ 1.33 from $ 1.19 for the same period last year.
Subscribers rose by 8.5 million units, to close 2021 at 221.8 million.
For the quarter of the year Netflix estimates only 2.5 million new subscribers, definitely below analysts' expectations.
Subscription growth has slowed since the start of the pandemic in 2020, when lockdowns forced billions of people home.
The reopening of the economy and growing competition have contributed to the slowdown which is now starting to worry investors.