Netflix on a subscriber roll, and Wall Street sends stock soaring
Wall Street gave two big thumbs up to Netflix Inc. on Monday -- sending the internet video service's stock to an all-time high -- after the company reported millions more new customers in the second quarter than many analysts had expected.
Netflix (NFLX) said it added 5.2 million total subscribers for its paid video streams in April, May and June, compared with a public target of 3.2 million for the second quarter. "We underestimated the popularity of our strong slate of content which led to higher-than-expected acquisition across all major territories," Netflix wrote in its earnings letter.
The company already famous for original series like "House of Cards," "Orange Is the New Black" and "Stranger Things" said more than 4.1 million of the 5.2 million new subscribers came from overseas, bringing its total paid international audience to more than 52 million. With 104 million total subscribers, Netflix now has slightly more customers overseas than it has in the U.S.
Shares jumped almost 9 percent in after-hours trading on news of the subscriber numbers, to nearly $177 late Monday afternoon.
Netflix shares have risen 30 percent since the beginning of the year, while the Standard & Poor's 500 index has climbed nearly 10 percent. In the final minutes of trading on Monday -- before the company released it second-quarter results -- shares had hit $161.21, an increase of 64 percent in the last 12 months.
The quarter's subscriber growth didn't come cheap. Netflix reported lower profits than most analysts had projected -- just $65.6 million for the three-month period.
On a per-share basis, the Los Gatos, California-based company said it had net income of 15 cents.
The results missed Wall Street expectations. The average estimate of 17 analysts surveyed by Zacks Investment Research was for earnings of 16 cents per share.
The internet video service posted revenue of $2.79 billion in the period, which topped Street forecasts. Twelve analysts surveyed by Zacks expected $2.76 billion.
