Netflix loses 800,000 U.S. subscribers
SAN FRANCISCO — Netflix’s video subscription service lost 800,000 customers in the third quarter - the biggest exodus in its history — even as its earnings rose 65 percent.
The losses were larger than management had previously warned. The unwelcome surprise, contained in financial results released Monday, was compounded by a forecast calling for millions of Netflix Inc.’s DVD-by-mail subscribers to cancel the service in reaction to dramatic price increases that took effect last month.
The bad news bruised already-battered stock as the shares plunged by more than 26 percent.
Netflix lost its luster among consumers and investors by raising prices as much as 60 percent in the U.S. and bungling an attempt to spin off its DVD-by-mail rental service.
The company, which is based in Los Gatos, Calif., ended September with 23.8 million U.S. subscribers, down about 800,000 from June. Netflix had predicted it would lose about 600,000 U.S. subscribers in a forecast released last month.
Management expects to gain U.S. subscribers in the current quarter, although Netflix didn’t set a specific target. But a substantial number of Netflix’s customers are expected to choose between renting DVDs through the mail or streaming video over high-speed Internet connections instead of paying for both services.
Netflix earned $62.5 million, or $1.16, per share, in the third quarter. That compared to income of $38 million, or 70 cents per share, at the same time last year.
Lawmakers to consider oil pipeline challenge
LINCOLN | Nebraska Gov. Dave Heineman says he’ll call a special legislative session for lawmakers to consider challenging the planned route of a massive transnational oil pipeline.
The Republican governor’s Monday decision means Nebraska doesn’t intend to just leave the matter to the federal government, which is expected to decide whether to approve the $7 billion Keystone XL Pipeline project by year’s end.
Pipeline opponents sought the special session to consider a proposal that would have given the state control over the pipe’s route. Mr. Heineman acknowledges the proposal is likely to face a court challenge.
The 1,700-mile Keystone XL pipeline would travel through Nebraska and five other states. Supporters say it could reduce U.S. dependence on Middle Eastern oil, while environmental groups say a spill could cause an ecological disaster.View Entire Story
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