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Netflix released its third quarter earnings report yesterday, and it looks like the company that once helped take down Blockbuster is on its way to taking itself down next. Since July, the company has been struggling to deal with the backlash following its announcement that it would split into separate mail-order and internet streaming services — and increase prices for both.

Though the company increased its earnings per share by $1.16 — significantly better than the 70 cents per share it posted last year and beating industry estimates of around 95 cents — it also lost about 800,000 customers, a drop of 3.25%.

According to Bloomberg’s Cliff Edwards:

This quarter, U.S. customers will fall short of the 24.9 million analysts were predicting. The outlook suggests Netflix has been unable to contain a subscriber revolt over a price increase and aborted plan to force subscribers into separate streaming and DVD services.

Michael Liedtke from Associated Press called Netflix a “company in crisis”:

Netflix lost more than a quarter of its value after the bad news came out. If that sharp decline holds in Tuesday’s trading, it will mark the first time Netflix’s stock price has fallen below $100 in nearly 14 months. Netflix shares shed $32.01, or nearly 27 percent, to $86.83 in Monday’s extended trading.

Reuters’ Lisa Richwine also mentioned Netflix’ plans to move into Europe in the beginning of 2012 as a source of concern, as CEO Reed Hastings predicted that profits from the company’s American business would not be enough to cover expansion costs:

Netflix has been writing big checks to expand its streaming content so it can attract new subscribers and return to the red-hot growth it was once famous for. In 2012, content spending will “nearly double” from this year, the company said. Netflix also forecast a loss for the first quarter of 2012 as it expands into Europe.

In a conference call yesterday morning, Hastings said the company would focus on its streaming arm in the future and continue to offer streaming and mail-order DVDs for $7.99/month each.