Netflix’s share price (or stock price) soared by over 5% in after hours trading yesterday (Monday 16 April) after the company posted its Q1 2018 earnings report, which revealed the popular streaming service had added over seven million new global users so far this year.
The company’s 7.41 million net subscriber adds crushed its 6.5 million Q1 expectation (Street Account estimate) and includes nearly two million new users in the US, while Netflix’s quarterly revenue was in line with forecasts ($3.7 billion posted vs $3.69 billion predicted by Thomson Reuters).
Its impressive Q1 2018 earnings report saw Netflix’s share price surge after hours, with today’s pre-market expectation putting its value at $327.68 – a 6.47% increase compared to close of play yesterday.
Could the company beat its all-time intraday high of $333.98 from March 12 when Wall Street opens later today?
That remains to be seen, but one thing’s for sure: Netflix truly is now the epitome of a modern media giant. With a valuation approaching $140 billion (~£97.6 billion), it’s only deemed to be $10 billion (~£7 billion) less valuable an entity than Disney – yes, Disney.
More amusingly, Netflix has used its moment in the spotlight to throw a bit of thinly-veiled shade at self-proclaimed “technology company” Facebook and the “other issues” currently engulfing the industry.
“We’ll spend over $10 billion on content and marketing and a billion-three on tech. So, I mean, just objectively, we’re much more of a media company in that way than pure tech. Of course, we want to be great at both. But, again, we’re really pretty different from the pure tech companies,” commented Netflix CEO Reed Hastings in earnings call.
He added: “I’m very glad that we built the business not to be ad-supported, but to be subscription,” Hastings said. “We’re very different from the ad-supported businesses, and we’ve always been very big on protecting all of our members’ viewing. We don’t sell advertising. So, I think we’re substantially inoculated from the other issues that are happening in the industry and that’s great.”
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In Q2 2018, Netflix is now expected to achieve $3.9 billion in revenue (Thomson Reuters) and 6.2 million in overall net subscriber adds (StreetAccount).
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