Netflix, Inc. (NASDAQ:NFLX) Q2 2019 Earnings Conference Call - Final Transcript
Jul 17, 2019 • 06:00 pm ET
prices, we did see some elevated churn rates and lower retention retention. So, it was a combination of those two things, we think the primary story was around seasonality and timing in nature of our content slate but pricing played a factor.
Now, the good news in all of that as you saw Mike, I think in the letter, is that in the first couple of weeks of Q3 that growth has re-accelerated again, we're seeing both that top of funnel growth in acquisitions. We're also seeing improvement in those churn rates and retention back down towards those pre-price change level. So, overall, you know encouraged with the trends and, and with regard to that pricing piece to it's worth kind of reminding ourselves, and it's all, that's all very revenue accretive. So while there may be some short-term slowdown in subscriber growth because of pricing that increased revenue is very good for our business and ultimately for our members because we reinvest the bulk of that back into create content and create product experience for our members.
Michael C. Morris
Can we talk a little bit about that pricing cycle and where we are right now. So two things, I guess specifically in the US, by June, the entire membership base seen a price increase such that there wouldn't be a lagging impact in the, in the September quarter. And then internationally, obviously, it's much broader, can you highlight any particular markets? Anything you can help us size of the portion of your member base that is processing through those pricing increases?
Greg, do you want take that, or you want me to take?
I'm happy to do that. So, in the US situation, we're through all those notifications, obviously in the international perspective, we've got different markets in different places, but I would say just in terms of helping you size that. I mean, we've built obviously in that into our forecast for Q3. So, those effects, we've already tried to account for and categorized in that forecast.
Michael C. Morris
Okay, great and then, Spence, one other question with respect to the letter on the outlook. It's the second consecutive quarter you've come ahead in operating income relative to your guide, you are maintaining the same full-year guidance. I know that you referenced the marketing but help us there with again, maybe why the timing from your perspective, forecasting hasn't been as clear, given that it feels that you would know when certain marketing was coming through.
Well, it's Marketing, we have and -- and touch [Phonetic] to chime in too, but we have some discretion as to when we choose to support titles and so, we're really, when you look at the back half, content slate that we have, we're very excited about with Stranger Things 3 already launching but then shows like La Casa de Papel and Crown and big movies in the fourth quarter and Money. Sorry, I already mentioned Money Heist. Sorry, but there is just, there is a