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Expand chart
Data: YCharts; Chart: Andrew Witherspoon/Axios

Netflix will bleed more cash this year than analysts expected, but the payoff won’t be more subscribers.

Driving the news: In its earnings report, Netflix said it expects its free cash flow deficit to be $3.5 billion this year — more than the $3 billion loss it previously estimated (the company says it's because of a change in corporate structure and investments in real estate and infrastructure).

  • Netflix also dialed back its expectations for subscriber growth, "anticipating a net add of 5 million paid subscribers for the second quarter," which is below Wall Street’s expectations for 6.09 million new paid members, as Axios’ Sara Fischer reports.
  • CEO Reed Hastings said last quarter that this year would be the peak for cash burn: "We’re still expecting free cash flow to improve in 2020 and each year thereafter, driven by our growing member base, revenues, and operating margins."

Why it matters: Wall Street has given Netflix’s cash burn a pass. The spend on content usually translates into more subscribers driven to the platform for said content. But investors’ knee jerk reaction was to sell the stock after its less-than-stellar guidance.

  • The stock rebounded after initially falling as much as 5% after the bell on Tuesday.

What to watch: With the launch of Disney+, viewers have yet another, cheaper option. This isn't lost on investors. Analysts, however, point out that streaming is not necessarily a zero sum game.

  • Of note: In the face of the heightened competition, Netflix is raising — not cutting — its monthly cost.

Go deeper: The revenue battles of Big Media vs. Netflix

Go deeper

In photos: Twin Cities on edge after Daunte Wright shooting

Demonstrators shout "Don't shoot" at the police after curfew on April 12 as they protest the death of Daunte Wright, who was shot and killed by a police officer in Brooklyn Center, Minnesota, a day earlier. Photo: Kerem Yucel/AFP via Getty Images

There were tense scenes in the Twin Cities suburb of Brooklyn Center Monday night, after demonstrators defied a 7 p.m. curfew to protest for a second night the fatal police shooting of Daunte Wright.

The big picture: The curfew was announced following a night of protests and unrest over the killing of Wright, 20, during a traffic stop Sunday. Following peaceful protests and a daytime vigil, police again deployed tear gas during clashes with protesters Monday night, according to reporters on the scene.

In photos: Life along the U.S.-Mexico border

Children at the border of the Puerto de Anapra colonia of Ciudad Juárez, Mexico, hang on a border fence and look to Sunland Park, N.M. Photo: Russell Contreras/Axios

Axios traveled to McAllen and El Paso, Texas, and Ciudad Juárez, Mexico, to see how the communities are responding to an increase of migrants from Central America.

Of note: The region in South and West Texas are among the poorest in the nation and rarely are the regions covered in depth beyond the soundbites and press conference. Axios reporters Stef Kight and Russell Contreras walked the streets of McAllen, El Paso, Texas, and Ciudad Juárez to record images that struck them.

Updated 3 hours ago - Axios Twin Cities

Police: Officer who shot Daunte Wright accidentally pulled gun instead of Taser

The officer who fatally shot Daunte Wright, a 20-year-old Black man, outside Minneapolis Sunday appeared to have inadvertently pulled out her gun instead of a Taser, police said.

What's new: Officials on Monday night identified the officer involved in the shooting as Kim Potter, who has been with the Brooklyn Center Police Department for 26 years.