Netflix is still racking up subscribe numbers at an impressive pace, but its profit is not what it once was.
Netflix’s overseas push helped make for a
blockbuster second quarter as the streaming movie service added 2.5 million new
subscribers.
The company said Wednesday that it had
more than 65 million subscribers, in total. Of those, 42 million are in the
U.S. and another 23 million were international. Netflix predicted it would have
69 million subscribers by the end of the third quarter.
The strong results helped lift Netflix’s
shares more than 10% in after-hours trading to around $107. The earnings came a
day after Netflix went ahead with a 7-1 stock split that may tempt more average
investors to take a position by reducing the share prices from above $700 to
closer to $100.
The company reported a 6 cent per share
profit (based on the post-split share price). This would be equivalent to 42
cents prior to the split, which beat the 28 cents analysts predicted. But the
amount fell well short of the 16 cents EPS (post-split) the company posted in
the same quarter a year ago. Revenue for Q2 was $1.481 billion, which compares
to $1.223 billion last year.
Netflix, which has a more volatile stock
than many companies, has seen its share price tumble after every one of its
second quarter earnings reports in the last six years – even though most of
those reports likewise beat expectations.
Prior to the earnings release Greenlight
Capital’s David Einhorn’s groused about Netflix’s original programming efforts,
saying the popular House of Cards “appeared to be scripted to compete
with Ambien.”
Netflix executives, including CEO Reed
Hastings, discussed the numbers via a live YouTube conference on Wednesday
afternoon. Hastings credited a strong launch in Australia and the popularity of
Netflix’s Spanish language content with subscribers as some of the reasons for
the successful quarters.
According to Time.
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