Netflix Inc. shares plunged more than 10% in the extended session Wednesday after the video-streaming giant badly missed projections for new paid subscriptions.

Netflix NFLX, +2.07% reported the addition of just 2.7 million paid subscribers globally in the second quarter, far short of what Wall Street and the company expected. Analysts were looking for global paid streaming subscriber additions of 5.3 million, according to FactSet, on domestic additions of 350,000 and 4.8 million internationally. Netflix had projected 5 million new customers.

In a letter to shareholders, Netflix executives noted that price increases began rolling out earlier this year, and disappointing subscriber additions were more targeted in regions that were experiencing the larger bills. They pointed more at a lack of fresh content in the quarter, though.

“We don’t believe competition was a factor since there wasn’t a material change in the competitive landscape during Q2, and competitive intensity and our penetration is varied across regions (while our over-forecast was in every region),” they wrote. “Rather, we think Q2’s content slate drove less growth in paid net adds than we anticipated.”

During an earnings video-conference call late Wednesday, Netflix CEO Reed Hastings said no single factor led to the subscription shortfall. A pricing increase, the quarterly content slate and seasonality were all factors, he and Chief Financial Officer Spencer Neumann acknowledged.

The subscription miss was Netflix’s largest since the second quarter of 2016. It lost 126,000 domestic paid subscribers vs. an expected gain of about 310,000.

Netflix was hurt by the defection of lower-priced subscribers who may be looking to jump to a wave of competing services over the next six to 18 months, eMarketer forecasting analyst Eric Haggstrom told MarketWatch in a phone interview. “Higher prices and more content choices could prove to be a difficult road, undercutting Netflix’s pricing power,” he said. “But a strong content schedule in Q3 should draw many former subscribers back in.”

Things could reverse course in the current quarter, with the premiere of its franchise program “Stranger Things,” new episodes of “The Crown,” and the final season of “Orange is the New Black.” Indeed, Netflix characterized Q2 as a momentary blip and projects a strong third quarter, with 7 million paid subscriber additions worldwide. It offered guidance of earnings of $1.04 a share on revenue of $5.25 billion.

The company in its shareholder letter reiterated its vow not to pursue advertising.

The company’s subscriber base is being closely watched as some of the world’s biggest brand names jump into the video-streaming business to challenge Netflix. Apple Inc. AAPL, +3.75% and Walt Disney Co. DIS, +1.23% will join the fray this year, with AT&T Inc.’s T, HBO Max and Comcast Corp.’s CMCSA, +0.98% NBCUniversal scheduled to launch services in 2020. The machinations have led to changes in licensing agreements that means the eventual departures of a pair of Netflix’s most popular programs, “The Office” and “Friends.”

At the same time, Netflix is pouring billions of dollars into original content. The Los Gatos, Calif.-based company spent $12.04 billion on content last year, up 35% from $8.9 billion in 2017, according to its fourth-quarter 2018 earnings report.

Netflix’s ever-changing content lineup isn’t likely to tap the brakes on future net additions and healthy average revenue per user, Morgan Stanley analyst Benjamin Swinburne concluded in a Tuesday note to clients. He said the imminent losses of “The Office” and “Friends” are “manageable” as the company’s original productions become its single biggest source of content. Swinburne maintains an overweight rating and price target of $450.

The company reported second-quarter net income of $271 million, or earnings of 60 cents a share, compared with $384 million, or 85 cents a share, in the year-ago period. Revenue grew to $4.92 billion from $3.9 billion in the year-ago period. Analysts surveyed by FactSet had estimated 56 cents a share on revenue of $4.9 billion.