Market Overview

Netflix Reports Q1 Earnings; Shares Rise

Related NFLX
The Market In 5 Minutes: Housing Starts A Bit Lower Than Expected, Chipotle Gets A Downgrade
From Nike To Netflix: What Teens Love And Hate In 2017
IBM Lifts Dow Futures, PayPal Leads IBD 50 As This Chipmaker Dives (Investor's Business Daily)

On Monday, April 21, 2014, Netflix (NASDAQ: NFLX) announced and released its first quarter financial results after market close.

Shares of the company are trading up $22.69 or 6.51 percent in after-hours trading, after the company beat analysts' expectations.

For the first quarter of 2014, the media giant reported earnings of $0.86 per share on revenues of $1.27 billion. Analysts had expected the company to report earnings of $0.83 per share on revenues of $1.27 billion.

Netflix also announced that in the first quarter it gained 2.25 million domestic subscribers and 1.75 million internationally. Domestically Netflix now has 35.7 million subscribers.

Additionally, in regard to its international space, the company has said that it plans on keeping the international space at a loss, but it is on track to attain profitability. The company also said that it expects non United States subscribers to surpass United States subscribers.

In Netflix's letter to shareholders, the media giant cited the second season of House of Cards as a big hit, and also cited that the company had ended the first quarter with over 48 million global members. International performance in the first quarter also accounts for 25 percent of the company's total streaming revenue, the company commented, “we anticipate our international segment to eventually surpass our U.S. market, similar to other Internet firms.”

See also: Amazon Earnings Preview - 'Strategy Road Map' Concerns Wedbush

The media giant commented on content, “We also continue to invest heavily in exclusive syndication licenses for some of the best series on television. For example, in the U.S., as Mad Men enters its final season, members can jump in or catch up on every previous season's episode on Netflix. The Walking Dead, Scandal, Bates Motel, The Following, New Girl, Sherlock and The Vampire Diaries are just a few of the exciting on-air series we offer four exclusively in this model. Dexter, House and Breaking Bad are no longer in production, but continue to be discovered and enjoyed everyday by a huge Netflix audience.”

The company is also raising its price in some countries and territories, “we saw limited impact from our January price increase for new members in Ireland (from €6.99 to €7.99), which included grandfathering all existing members at €6.99 for two years. In the U.S. we have greatly improved our content selection since we introduced our streaming plan in 2010 at $7.99 per month. Our current view is to do a one or two dollar increase, depending on the country, later this quarter for new members only. Existing members would stay at current pricing (e.g. $7.99 in the U.S.) for a generous time period. These changes will enable us to acquire more content and deliver an even better streaming experience.”

Posted-In: Earnings News Guidance Dividends


Related Articles (NFLX)

View Comments and Join the Discussion!

Partner Center