Netflix today reported its earnings for Q4 2019, which is the first quarter in which Netflix had direct competition from Apple TV+. In the accompanying letter to shareholders, Netflix took a direct shot at the popularity of the Apple TV+ series “The Morning Show.”
For the quarter, Netflix reported earnings per share of $1.30 and revenue of $5.47 billion. While revenue beat analyst expectations, Netflix fell short on domestic subscriber additions, adding 550,000 versus expectations of 589,000. Netflix stock is down over 2.5% in after-hours trading.
Netflix CEO Reed Hastings has long emphasized that Netflix isn’t worried about the competition of Apple TV+, largely because new streaming services will only help further expedite the shift from linear TV to streaming. In today’s letter to investors this quarter, Netflix reiterates that:
Many media companies and tech giants are launching streaming services, reinforcing the major trend of the transition from linear to streaming entertainment. This is happening all over the world and is still in its early stages, leaving ample room for many services to grow as linear TV wanes. We have a big headstart in streaming and will work to build on that by focusing on the same thing we have focused on for the past 22 years – pleasing members.
The company also points out that during Q4 2019, despite the launch of Disney+ and Apple TV+, Netflix’s “viewing per membership” grew globally and domestically on a year-over-year basis.
And to further emphasize the point, the letter includes a bizarre screenshot of Google search trends comparing Amazon’s “Jack Ryan,” Disney+’s “The Mandalorian,” Apple TV+’s “The Morning Show” and Netflix’s “The Witcher.”
Of course, Apple hasn’t provided any sort of data on the adoption of Apple TV+, so Netflix has no real data to compare itself against — hence why it chose a Google search trends result instead. Netflix says that “The Witcher” is shaping up to be its “biggest season one TV series ever,” though it also changed how it tracks viewership this quarter.
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