The admission, revealed in an S-3 form the company filed on Monday, states that “as a result of the relatively flat consolidated revenues and previously announced increased investment in our International segment, we expect to incur consolidated net losses for the year ending December 31, 2012.” Netflix had previously projected that it would lose money only for the first few quarters of 2012. Previous estimates by analysts were for a profit of $1.11 per share for 2012.
Netflix made the filing on Monday related to a $200 million stock offering via T. Rowe Price Associates at $70 a share. Netflix raised another $200 million through the private placement of convertible notes to funds affiliated with Technology Crossover Ventures, according to a statement from Netflix.
The company noted in the filing that “consistent with our Q4 guidance, our domestic streaming and DVD gross cancellations continued to steadily decline in October and the first half of November.” However, “gross additions of new streaming subscribers remained strong.” The filing went on to predict that the company expects domestic streaming net additions to be flat for November, but then pick up in December. The fallout of subscribers canceling their DVD-by-mail subscriptions — a result of Netflix’s decision to raise prices over the summer — will continue through the next year, the company projects.
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