SAN FRANCISCO – Netflix's subscriber growth in the latest quarter lagged management's forecast as the Internet video service's recent price increases turned off potential new viewers.
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The disappointing performance announced Wednesday spooked investors already on edge after Time Warner Inc.'s HBO channel announced plans to compete against Netflix by offering an Internet-only package in the U.S beginning next year.
Netflix's stock plunged $103.49, or 23 percent, to $345.
The service gained about 3 million subscribers worldwide during the three months ending in September. Netflix Inc. had predicted it would add about 3.7 million customers in the third quarter.
Netflix CEO Reed Hasting blamed most of the shortfall on a price increase of roughly a $1 per month that kicked in during May. The increase boosted Netflix's U.S. price to $9 per month.