Published: Sat, October 20, 2018
Economy | By

Netflix adds more subscribers than thought

Netflix adds more subscribers than thought

But even at the time, analysts noted that the company tended to follow a pattern of second-quarter dips followed by third-quarter surges; indeed, in the third quarter in 2016, subscriber numbers rose after a second-quarter disappointment.

Shares of Netflix (NFLX) skyrocket almost 10% in pre-market trading Wednesday after the streaming giant delivered third-quarter financial results that crushed Wall Street's expectations in an upside surprise. The stock been volatile this year, starting at $200 and reaching a peak value of $423 in June, then going up and down for the rest of the year closing at $346 yesterday. By 2022, that's expected to more than double, making India one of the top 10 markets for the services, with subscription video making up nearly 80% of the market, PricewaterhouseCoopers said.

Netflix (NFLX) is scheduled to report its third quarter earnings today, which could give the tech sector a much-needed revival, particularly after last week's trading session that saw the Dow Jones Industrial Average lose as much as 1,300 points in two days. "We'll see how that does in terms of being able to accelerate our growth". The company had revenue of $4 billion during the quarter, compared to analyst estimates of $3.99 billion.

Netflix reported 1.09 million domestic subscriber additions, surpassing estimates of 673,800.

In related news, Director Richard N. Barton sold 350 shares of Netflix stock in a transaction that occurred on Thursday, October 11th.

Netflix is the first of the so-called Faang companies (Facebook, Apple, Amazon, Netflix and Google) to report this quarter. Netflix expects to add 28.9 million customers this year, setting a new record for the 21-year-old company. By the end of the year, Netflix expects to expand that base to 146.5 million. Netflix didn't identify the most successful shows.

Still, growth in this high-potential market will not come overnight, the company said. Disney and AT&T Inc, the parent of Warner Bros. and HBO, are each looking to introduce new services next year - after completing takeovers of other companies worth a combined $160 billion.

Analysts estimate that it added about 676 hours of original programming in the USA in the most recent quarter, 135% more than in the same period a year earlier.

Netflix said the investments were critical to the firm's growth. Global streaming revenues jumped 49 per cent to $US1.97 billion, while domestic sales increased 25 per cent to $US1.94 billion. Equities research analysts forecast that Netflix will post 2.67 EPS for the current year. The company added 6.96 million overall paid users, topping Wall Street's expectation of 5.15 million additions, and an internal projection of about five million.

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