Netflix's earnings report was in line with analysts' estimates. Its stock plunged anyway, falling by double digits on Friday before pairing some losses.
The company reported $12.56 billion in revenue, a 13% inter-annual increase, just below analysts' expectations. The company said the figure could be explained by membership growth, pricing and increased ad revenue.
The company also noted that price increases last year were consistent with its expectations. It expects revenue to grow 12% the next quarter, saying its outlook for the year is consistent with previous forecasts.
CNBC noted that analysts were focused about user engagement. The company said it is "healthy," and that live events were key to attract members, who watched close to 100 billion of content in the first half of the year. Such events accounted for six of the top 10 new member sign-up days the past five years. It is also in negotiations to broadcast more NFL and MLB games, as well as WWE and the Women's World Cup.
"I'll start by saying there is not a linear relationship between viewing hours and revenue and profit, because all hours are not created equal," said company co-CEO Greg Peters.
Ted Sarandos, the other co-CEO, said there is not any "material change" in engagement during second seasons compared to the first one, in reference to reports claiming there was.
"Our season two fall off has actually slightly improved this year relative to last year, so no changes in release strategies," Sarandos claimed.
