Netflix shares dived Thursday evening after close, despite the positive second quarter earnings. Netflix announced it had added 10.09 million more paid subscribers than expected,
The company predicted paid subscribers would dip below estimates in the third quarter, in an early sign that the lockdown boost to streaming may be waning as stay-at-home orders ease and layoffs and furloughs across industries increase. The forecast sent shares down 10% in after-hours trading.
“We live in uncertain times with restrictions on what we can do socially and many people are turning to entertainment for relaxation, connection, comfort and stimulation. As we navigate these turbulent circumstances, we’re focused on our members by continuing to improve the quality of our service and bringing new films and shows to people’s screens,” Netflix said in its letter to shareholders.