Latest News: Technology |  Celebrity |  Movies |  Apple |  Cars |  Business |  Sports |  TV Shows |  Geek

Trending

Filed under: News

 

Netflix Roars Back With 20% Earnings Beat, Stock Flies In Aftermarkets

Jan 23 2014, 2:03am CST | by

1 Updates
Netflix Roars Back With 20% Earnings Beat, Stock Flies In Aftermarkets
 
 

YouTube Videos Comments

Full Story

Netflix Roars Back With 20% Earnings Beat, Stock Flies In Aftermarkets

Netflix sped past subscriber estimates in its fourth-quarter 2013 report tonight, and likely beat out former pay TV king, HBO, capturing the subscription TV crown that cements leadership. With a business model that frees subscribers from the cable cord and trumps the TV schedule, Netflix showed that users favor flexibility and an ability to watch one show or binge on a whole series. And, subscribers want to select the viewing device, whether it’s a large screen TV, phone, tablet or desktop computer. With Netflix, subscribers can control when, where and what they watch, but with cable subscriptions, they can’t. (Note: I own Netflix shares.)

Netflix reported earnings per share of $.79 that beat the Street estimates of $.66 per share by 20%, propelling the stock in double digits in the aftermarkets. Fourth-quarter EPS jumped 50% compared with a year ago and proved Netflix’s investment in original content and international expansion paid off in spades. Revenues in the quarter were $1.2 Billion with net income of $.48.4 million.

In a carefully watched metric, Netflix announced 2.3 million net additional subscribers, above consensus estimates of 2.1 million. Domestic paid subscribers jumped to 32.7 million, likely topping HBO’s subscribers for the same time period, estimated at 30 million. Netflix management raised guidance for the first quarter 2104 and said they planned to continue to invest in original programming.

CEO Hastings Sees Clear Skies

With all the hoopla around cable consolidation and changes to the FCC’s rules on net neutrality, the stock has been on a roller coaster. Netflix CEO Reed Hastings was nonplussed. “We don’t see much cable industry consolidation per se — we see an instance of John Malone trying to consolidate Time Warner Cable into Charter Communications. And we don’t anticipate a material change in ISP pricing for our service,” despite the FCC’s legal setback that will give service providers more pricing flexibility.

Netflix does see a change in competitive stakes and believes the industry is headed toward a playoff between broadband franchises and over-the-top players.  Hastings was unconcerned about Verizon’s purchase of Intel’s internet MVPD company and viewed it as a minor competitor.

If tech giants dive further into TV, notably long-rumored Apple, TV services could be organized as apps with focus on-demand rather than linear. If so, program discovery would be a critical problem to solve, and Silicon Valley is better positioned to crack it than New York.

Competitors Miss The Bus

Time Warner may be considering new strategies for HBO Go service, its mobile subscription service available through cable companies. Users have complained about difficulties accessing the app. And cable providers are confused about who owns the rights for signals outside the home.

When cable consultant Barbara Bellafiore, CEO, Bell Communications Group and I jointly tried to subscribe to HBO Go through Cablevision last week, after making the request on the website, calling the 800 number and emailing for an hour, our attempt was unsuccessful. By comparison, it took us three minutes to sign up for Netflix.

TV viewing is moving on-demand and becoming personalized, and those that don’t change will miss the bus.

Source: Forbes

 

iPad Air Giveaway. Win a free iPad Air.

You Might Also Like

Updates


Sponsored Update


Advertisement


More From the Web

Shopping Deals

 
 
 

<a href="/latest_stories/all/all/31" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

 

Comments

blog comments powered by Disqus

Latest stories

Sharknado 2: The Second One Premieres Tonight
Sharknado 2: The Second One Premieres Tonight
Sharknado 2's about to strike Manhattan, New York City. Find out how to survive SyFy's latest monster movie.
 
 
Jadeveon Clowney Aces Jim Washburn's Drill
Jadeveon Clowney Aces Jim Washburn's Drill
Houston Texans rookie linebacker Jadeveon Clowney is just the second player to ace defensive line coach Jim Washburn's drill for evaluating pass rushers.
 
 
Master of Craft Game Review
Master of Craft Game Review
A brand new role-playing game (RPG), Master of Craft (MoC) is fully rendered in 3D. Avid fans and lovers of RPGs enjoy its unique economy where they are allowed to craft and produce their own armors and weapons. Moreover, players can also operate their market and experience to be a merchant and run their own town. The objective of the game is to build a large empire of buildings and focuses solely on crafting armors and weapons.
 
 
Liam Neeson and Natasha Richardson&#039;s Final Moments
Liam Neeson and Natasha Richardson's Final Moments
Liam Neeson's opening up about the couple's final moments before taking Natasha Richardson off life support.
 
 
 

About the Geek Mind

The “geek mind” is concerned with more than just the latest iPhone rumors, or which company will win the gaming console wars. I4U is concerned with more than just the latest photo shoot or other celebrity gossip.

The “geek mind” is concerned with life, in all its different forms and facets. The geek mind wants to know about societal and financial issues, both abroad and at home. If a Fortune 500 decides to raise their minimum wage, or any high priority news, the geek mind wants to know. The geek mind wants to know the top teams in the National Football League, or who’s likely to win the NBA Finals this coming year. The geek mind wants to know who the hottest new models are, or whether the newest blockbuster movie is worth seeing. The geek mind wants to know. The geek mind wants—needs—knowledge.

Read more about The Geek Mind.