Netflix Soars After Hours as Third-Quarter Earnings Beat Expectations
Shares of Netflix touched a new 52-week high in late trading after the company reported better-than-expected third-quarter earnings today [link opens in PDF].
Revenue improved 22% to $1.1 billion, in line with estimates, while earnings quadrupled to $0.52 a share. Domestic streaming subscriber additions -- a key growth indicator -- improved to 1.29 million. Analysts had been modeling for $0.49 a share in profit and 1.16 million domestic streaming additions.
Netflix now serves more than 40 million paid streaming members worldwide, including 9 million outside the U.S. Another 7.1 million rent DVDs from the company, resulting in $107 million in contribution profit during the third quarter.
Internationally, revenue more than doubled to $183 million while losses narrowed from $92 million in last year's Q3 to $74 million this year. International additions improved to 1.44 million from 0.69 million.
Looking ahead, management expects $0.60 a share in fourth-quarter profit and 2.01 million domestic streaming additions. Wall Street was looking for $0.46, according to data compiled by Yahoo! Finance.
In 2014, Netflix plans to double its investment in original content. The network won its first ever Primetime Emmy Award when David Fincher took home honors for directing the original series House of Cards.
The article Netflix Soars After Hours as Third-Quarter Earnings Beat Expectations originally appeared on Fool.com.Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team and the Motley Fool Supernova Odyssey I mission. He owned shares of Netflix at the time of publication. He was also long Jan. 2014 $50 Netflix call options. Check out Tim's web home and portfolio holdings or connect with him on Google+, Tumblr, or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.The Motley Fool recommends Netflix. The Motley Fool owns shares of Netflix. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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