Netflix reveals growth in subscribers and announces plans to launch video games

Subscriber growth and plans

In Netflix's second-quarter report, the company reported revenue growth of 19%, above estimates, with the number of new paid subscribers also surpassing Wall Street estimates. Netflix said it would add video games to its streaming service.

Netflix (NFLX) gave mixed signals to investors in its report on Tuesday, as the company continues to face contrasting year-on-year comparisons. Netflix's earnings for the second quarter ended June 2021 rose 87% to $2.97 per share.

Revenues rose 19% to $7.34 billion, slightly above analysts' estimates of $7.32.

The streaming company added 1.54 million new paid subscribers worldwide, better than market analysts' expectations of $1.19 million. However, these figures show a stark contrast to the boom in demand last year amid the coronavirus pandemic. Netflix attracted almost 26 million new customers in the first half of 2020. Almost all of Netflix's growth in new paid subscribers in the second quarter came from two regions Latin America and Asia Pacific the company's two smallest regions. At the same time, the streaming service lost 430,000 customers in its largest regions, the US and Canada, for the first time in two years.

Investors saw this decline in the company's last report as well.

Netflix shares fell 3.4% in the last quarter and are down 1.8% since the start of 2021.

Netflix video games

Netflix executives said it will release video games on the mobile version of its platform. Netflix will develop games both internally and license games from third-party studios, as it does for movies and shows. In this way, the company sees video games as a way to attract more people to its core service. It will also help Netflix better compete with growing streaming services like Disney+ (DIS), Amazon Prime Video (AMZN), Apple TV (AAPL) etc. Netflix predictions

Netflix expects to add 3.5 million new paid subscribers in the third quarter, compared to analysts' forecast of 5.46 million.

The company's third-quarter earnings per share forecast is $2.55, ahead of forecasts, and revenues are in line with Wall Street forecasts of $7.48 billion. The company initiated a share buyback programme last quarter and said it would continue to buy back shares in the future.