Netflix’s subscriber growth cooled in the first quarter of 2021 after record pandemic-fueled gains last year — and the streamer added about 2 million fewer customers than it previously expected.

For Q1, the company reported 3.98 million in net global streaming subscribers. That was below its previous guidance of 6 million. On the miss, Netflix shares fell more than 10% in after-hours trading.

As of the end of March, Netflix had 207.4 million paid streaming customers worldwide, up 13.6%.

For 2021, the company said it expects to spend more than $17 billion in cash on content — up more than 44% compared with $11.8 billion last year, when numerous productions were put on hold because of the coronavirus crisis.

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For the first quarter, Netflix had previously forecast adding a net 6.0 million new subscribers — well below the record 15.8 million it packed on in Q1 2010 after initial COVID-19 lockdowns a year earlier. Analysts consensus estimates had pegged 6.22 million net adds.

Netflix’s Q1 financials topped Wall Street estimates. The company posted quarterly revenue of $7.16 billion and earnings of $3.75 per share; analysts on average had expected Netflix to report revenue of $7.13 billion and EPS of $2.97, per Refinitiv.

“We believe paid membership growth slowed due to the big COVID-19 pull forward in 2020 and a lighter content slate in the first half of this year, due to COVID-19 production delays,” the streaming giant said in its quarterly letter to shareholders.

Netflix said it continues to expect “a strong second half with the return of new seasons of some of our biggest hits and an exciting film lineup.”

More to come

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