Photo Credit: Lars Plougmann/Flickr.com

According to a recent MarketsandMarkets report, the global video streaming market is estimated to grow from $30.29 billion in 2016 to $70.05 billion in 2021. That translates to an annualized growth rate of 18% over the five-year period. Netflix (Nasdaq: NFLX) is already delivering more than the industry’s growth rate in its revenue growth. But things may not look all that rosy in the future.

Netflix’s Financials

Netflix’s Q1 revenues grew 35% over the year to $2.64 billion, in line with the Street’s forecast for the quarter. EPS of $0.40 was better than the market’s projections of $0.37 for the quarter.

During the quarter, Netflix added 1.42 million domestic subscribers and 3.53 million international subscribers. The growth was lower than the analyst forecast of an addition of 1.56 million domestic and 3.71 million international subscribers. The increase in subscribers was also lower than Netflix’s own forecast of an addition of 1.5 million domestic and 3.7 million international subscribers. It ended the recent quarter with 98.75 million subscribers overall of which 50.85 million were domestic subscribers and 47.89 million were international subscribers.

For the current quarter, Netflix forecast net additions of 3.2 million subscribers with 600,000 of them being added in the domestic market. The growth forecast is much higher than the Street’s forecast of an addition of 2.23 million subscribers in the quarter. With the forecast growth, Netflix will also cross the 100 million subscriber milestone by ending Q2 with 101.95 million total members. Netflix expects stellar performance in Q2 as the fifth season of its original content House of Cards returns to the platform in the quarter. The program was originally slated to be released in Q1, a reason, it says, caused the miss on Q1 subscriber additions.

Netflix expects Q2 revenues of $2.76 billion with an EPS of $0.15. The Street was looking for revenues of $2.76 billion in Q2 with an EPS of $0.24.