Netflix, Inc. Earnings Send Shares To Another Record High

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Netflix, Inc. Earnings Send Shares To Another Record High
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Netflix, Inc. (NASDAQ:NFLX) released its latest earnings report after closing bell this afternoon. Netflix earnings came in at 41 cents per share on $3.3 billion in revenue for the fourth quarter, both of which were in line with estimates. In the same quarter a year ago, the streaming giant reported earnings of 15 cents per share on $2.5 billion in revenue.

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Netflix earnings in line with consensus

Before the Netflix earnings release this afternoon, analysts had been debating whether the price increase that went into effect during Q4 had any impact on the company’s subscriber adds, and it looks like the bulls had it.

Netflix added 8.33 million subscribers during the fourth quarter, compared to the 7.1 million it added in the fourth quarter of 2016. Wall Street had been expecting the company to add only 6.4 million subscribers. Netflix’s subscriber adds in Q4 included 1.98 million domestic streaming subscribers and 6.36 million international subscribers, compared to the consensus numbers of 1.27 million domestic subscribers and 5.05 million international subscribers. Netflix had guided for 1.25 million domestic and 5.05 million international subscriber adds.

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EBITDA rose to $313 million from $212 million a year ago, while free cash flow was -$524 million, bringing the full-year total to -$2 billion, which was at the bottom of their guided range of -$2 billion to -$2.5 billion. Netflix also said that it took a non-cash charge of $39 million in connection with unreleased content it plans not to move forward with. The company also reported that its international business delivered the first full year of positive contribution profit in its history.

Guidance for Netflix earnings in Q1

For the current quarter, Netflix management expects about $3.7 billion in revenue and earnings of about 63 cents per share. They also expect about 6.35 million total subscriber adds, including 1.45 million domestic and 4.9 million international subscriber adds. Prior to the Netflix earnings release this afternoon, JPMorgan analysts had been expecting Netflix to guide for approximately 1.25 million domestic subscriber adds and 3.75 million international subscriber adds.

Netflix stock skyrocketed in after-hours trading, climbing by more than 8% to a new high of $247.65.

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Michelle Jones is editor-in-chief for ValueWalk.com and has been with the site since 2012. Previously, she was a television news producer for eight years. She produced the morning news programs for the NBC affiliates in Evansville, Indiana and Huntsville, Alabama and spent a short time at the CBS affiliate in Huntsville. She has experience as a writer and public relations expert for a wide variety of businesses. Email her at Mjones@valuewalk.com.
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