Netflix stock dropped over $7 per share to $30.76 on Tuesday after its first quarter earnings report that merely matched analyst expectations, according to the Associated Press on Tuesday. The company also announced that it will raise rates later this year for those renting Blu-ray movies.

Even though Neflix’s first quarter profits rose 36 percent and revenue rose from US$305M to $326M, year over year, investors were disappointed that the company didn’t do better than expected.

Despite the rate hike for Blu-ray renters, Netflix has done well. The company added 764,000 new in the quarter customers and now has 8.24 million subscribers. Much of the surge came when Blockbuster raised its prices, and that drove disgruntled customers to Netflix who cut prices last summer.

Netflix expects new subscribers to be lower this quarter as people spend more time outdoors in the warmer weather instead of watching movies.

Netflix didn’t provide any additional information about the specifics of the rate hike for Blu-ray customers or whether the hike would be in proportion to the Blu-ray titles available as a percentage. They have said, however, they they expect to have about 1,500 Blu-ray titles available this year, and the acquisition of those titles will increase their expenses. The company also announced new partners that will bring its Internet streaming library of movies to about 9,000 titles available at no extra charge. So far, however, that service remains Windows only.