Thursday, 13 December, 2018

Netflix Adds 7 Million Subscribers, Beats Estimates, Sends Stock Soaring 12%

More Than 80 Million Subscribers Watched Netflix Rom-Coms This Summer Netflix shares soar after record growth
Freda Brock | 17 October, 2018, 13:23

Netflix NFLX saw its stock price soar in after-hours trading after the streaming TV giant posted third-quarter subscriber growth that blew away its own projections by roughly 2 million.

The streaming behemoth said Tuesday that its subscriber base grew by almost 7 million in the quarter, led by the addition of 5.9 million new users overseas.

Netflix is among the first of the major U.S. tech firms to report earnings.

The performance stands in stark contrast to Netflix' earnings report three months ago, when the company's stock fell as much as 14% after subscriber growth fell short of analyst estimates.

Netflix shares have risen more than 70 percent so far this year.

"In addition to our commercial success, we're ecstatic when the creators we work with are recognised for their inspiring work".

Brexit standoff continues before European Union summit
Speaking after being briefed by the EU's chief negotiator Michel Barnier, Mr Tusk played down expectations of a breakthrough. Germany's Europe minister called on May to "take responsibility and be constructive".

For its part, Netflix is also making a transition from the old to the new.

Netflix is investing more than $8bn in entertainment programming this year to lure new customers around the world. Netflix added 5.15 million subscribers in the second quarter of 2018, missing management's original forecast for 6.2 million. The four make up the so-called FANG group of high-growth companies that in recent months has lost some of its momentum following market-leading gains in recent years. Netflix signed up 6.96 million customers in the quarter, according to a statement on Tuesday (Oct 16), boosting its global total to 137.1 million. Netflix doesn't break out its users by market, with the exception of the USA, though most analysts agree that the U.K., Brazil, Canada and Mexico rank among the company's largest.

Netflix's net income rose to $402.8 million, or 89 cents per share, in the third quarter ended September 30, up from $129.6 million, or 29 cents per share, a year earlier. And it brought in 5.87 million worldwide subscribers, topping the 4.46 million estimate.

Netflix plans to spend about US$8 billion on programming this year.

Looking ahead, Netflix expects to add 7.6 million paid users and 9.4 million total subscribers during the fourth quarter.

The Netflix executive highlighted the streaming service's varied content palate, with the addition of new animated adult comedies - Disenchantment, from Matt Groening, creator of The Simpsons and Futurama, and Paradise PD, from the makers of Brickleberry, to complement Big Mouth, Bojack Horseman and F is for Family - and its popular romantic comedies, including To All the Boys I've Loved Before, one of the service's most-viewed original films with strong repeat viewing. Yet, Wall Street will likely continue to focus on NFLX's subscriber growth going forward with streaming platforms from Apple AAPL, Disney DIS, and AT&T T all due out over the next few years.

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