The coronavirus pandemic has prompted a record number of Netflix sign-ups.
The video streaming service added 15.77 million paid subscribers during the first quarter, right as COVID-19 began forcing entire populations to stay at home. “Our membership growth has temporarily accelerated due to home confinement,” Netflix said in a Tuesday letter to shareholders.
The growth was up everywhere, including the US and Canada, which added 2.3 million new subscribers during the quarter — a major improvement from the 130,000 subscribers Netflix lost three quarters ago. (It was also the first time the company broke the 10 million barrier on adding paid subscribers in a three-month period.)
“During the first two months of Q1, our membership growth was similar to the prior two years, including in UCAN (United States, Canada). Then, with lockdown orders in many countries starting in March, many more households joined Netflix to enjoy entertainment,” the company said.
However, the biggest gains were made in the Europe, Middle East, and Africa region, where Netflix added 7 million paid subscribers. “Their business is a near perfect fit to a population that is suddenly housebound,” said Eric Haggstrom, an analyst at eMarketer. “Netflix faces some headwinds moving forward from a poor economic environment, but a significant chunk of consumer entertainment budgets have been opened up from the closures of movie theaters, sporting events, restaurants and bars.”
In total, Netflix now has 183 million paid subscribers globally. The company also noted that the documentary Tiger King: Murder, Mayhem and Madness has been watched by 64 million households — the same number of views Season 3 of Stranger Things attracted during the first four weeks of its airing last year.
On the downside, the coronavirus is disrupting Netflix’s plans to add new shows and movies to the streaming service. “When it comes to production, almost all filming has now been stopped globally, with the exception of a few countries like Korea and Iceland,” the company said.
Netflix is now warning that some upcoming titles will be delayed, while adding: “No one knows how long it will be until we can safely restart physical production in various countries.”
Fortunately, for the current quarter, Netflix is on track to release all its planned shows and movies on schedule. This includes the much-anticipated Space Force, a new comedy series starring Steve Carrell and produced by Greg Daniels, which is slated to air on May 29.
The company is also trying to wrap up the shows that have completed filming. “On the post production side, we’ve been able to get 200+ projects going remotely. Most of our series writers’ rooms are operating virtually,” Netflix said.
For the second quarter, Netflix is projecting to only add 7.5 million subscribers. The reason: It’s betting that governments will begin lifting the stay-at-home orders. “As that happens, we expect viewing and growth to decline,” the company added.
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