Netflix’s huge subscriber growth miss in Q1 was still better than HBO Max’s performance

godzilla vs kong
“Godzilla vs. Kong”

  • HBO Max added nearly 3 million subscribers in Q1, while Netflix added about 4 million.
  • Netflix’s quarter was considered terrible and sent its stock down 10%. It still beat HBO Max.
  • Still, there was some good news for both Netflix and HBO Max.
  • See more stories on Insider’s business page.

Netflix had a disappointing first quarter that sent its stock tumbling 10%. But it still beat HBO Max.

WarnerMedia’s HBO Max gained almost 3 million subscribers in the first quarter of 2021, but fell short of Netflix’s worst miss since 2013. Netflix added about about 4 million subscribers – 2 million shy of its initial projections for the quarter. It’s now projecting just 1 million subscriber additions in Q2.

AT&T, the corporate parent of WarnerMedia, said during its Q1 earnings report on Wednesday that Max now had 9.7 million retail subscribers (those who subscribe directly to Max), an increase of 2.8 million from the previous quarter. It didn’t disclose “activations” as it previously has, which account for HBO customers who have accessed their Max subscription.

zack snyder justice league
“Zack Snyder’s Justice League”

The results come after a quarter in which WarnerMedia made bold moves to help boost Max subscribers. Its decision to release movies simultaneously in theaters and on HBO Max this year was particularly met with backlash in Hollywood.

Movies like “Godzilla vs. Kong” and “Tom and Jerry” have been box-office successes despite also streaming. (“Godzilla vs. Kong” has passed $80 million domestically and is approaching $400 million at the worldwide box office.) “Zack Snyder’s Justice League,” the long-awaited director’s cut of the superhero teamup movie, also debuted exclusively on Max in the US after a years-long fan campaign.

That didn’t seem to translate into huge subscriber growth, however.

Still, despite lackluster quarters, there’s some good news for both Netflix and Max.

Netflix missed subscriber expectations, but churn decreased. As Insider’s Ashley Rodriguez reported, retaining existing subscribers could help Netflix sustain its edge in the streaming space during what will be a challenging year after pandemic-related growth in 2020. Netflix has 207 million subscribers worldwide, with 67 million in the US.

And data has shown that WarnerMedia’s hybrid theatrical/streaming strategy has helped Max. “Wonder Woman 1984,” which debuted on Max and in theaters at the same time, generated 4.3 times the signups compared to the average weekend in December, according to the analytics firm Antenna.

As more Warner Bros. movies are released throughout the year under the same strategy, including “The Suicide Squad,” “The Conjuring: The Devil Made Me Do It,” and “Dune,” Max could benefit.

Read the original article on Business Insider