SAN FRANCISCO: Netflix is erasing a six-day losing streak after a report that it’s pushing users to subscribe on its website, rather than through the app — pulling revenue from app-store owners like Apple.
The entertainment streaming company is also benefiting after a bullish analyst note, which predicted international subscriber additions would exceed expectations in the second half of the year by at least 10%. Shares gained 3.7% Tuesday.
Currently, Netflix users on iPads and iPhones have the option to subscribe via the App Store’s in-app-purchase system. This makes subscribing to Netflix simpler for Apple users, but also gives Apple a 15% cut of those subscriptions. Netflix told TechCrunch that it’s testing a change that bypasses in-app subscriptions in countries such as the UK and Brazil, and instead re-routes users to its own website. The test will run through Sept 30.
A particularly strong lineup of original content should help the company outperform expectations for international additions by about 1 million in the second half of 2018, said William Blair analyst Ralph Schackart, who rates the stock outperform.
Netflix has fallen 15% since reporting subscriber additions in the second quarter that missed Wall Street estimates by nearly 1 million users on July 16. The Los Gatos, California-based company had been the best performing stock in the S&P 500 this year as recently as last month. It’s still up more than 77% in 2018.