Netflix is one of the streaming services that saw its subscriber count increase significantly during the coronavirus period.
Netflix saw growth in the first quarter of 2020, exceeding expectations and beating initial forecasts. Subscribers increased by 15.7 million and revenue reached $5.76 billion (up 27% from the first quarter of 2019). Initially, experts had said they couldn't be sure, as they couldn't know how the pandemic profits.
The majority of subscribers came from Europe (around 4.4 million), while 2.3 million came from the US and Canada.
The increase in subscribers is apparently due to the confinement of people due to coronavirus. So it may be temporary. People are staying at home and looking for ways to spend their time pleasantly. For this reason, many of them have turned to streaming services.
In a letter to shareholders, Netflix said it expects viewership and subscriptions to increase this quarter, but warned that there could be a decline once people emerge from quarantine.
Netflix said it expects 7.5 million new subscribers globally in the second quarter of 2020, but warned that this is "speculation" as we do not yet know when quarantine measures will be lifted.
The company also said that shows and movies that were expected to be released in the second quarter would likely be released as planned, as their filming had already been completed.
The company said it had reduced streaming quality in countries where it had been asked to do so. Both Netflix and YouTube announced quality reductions in Europe to keep the internet running smoothly.
Netflix will face some challenges, however, as production on some new shows has been postponed. On the other hand, the company has committed to spending $150 million to help the film industry during the crisis. This includes a $100 million fund to help TV and film industry workers affected by the crisis and a $30 million donation to non-profit organizations.
Netflix also released some numbers showing viewership of some popular shows for the quarter. About 30 million households watched the dating show “Love is Blind” and 64 million watched the documentary series “Tiger King.” The film “Spenser Confidential” was seen in 85 million households. Netflix changed its viewing metrics in January. A user only has to watch a show for two minutes. That’s enough for Netflix to count it as a view.
Before the crisis, one of the biggest issues for Netflix was increasing competition in the streaming space from companies like Disney.
Netflix CEO Reed Hastings said he is impressed with the performance of Disney+.
Hastings said Netflix is making sure to boost content for children and families to compete with Disney's impressive "family-friendly" programming.
