Netflix stock closed up nearly 17 per cent after the streaming giant beat earnings estimates, revealing it added almost seven million net subscribers in Q3.
Posting its third-quarter earnings report, the company said its broad slate of original programming helped drive a solid quarter of growth with streaming revenue increasing 36 per cent year over year and global membership surpassing 130 million paid and 137 million total.
The company reported revenue of $4 billion, on target with estimates, with earnings per share (EPS) of 89 cents vs. estimates of 68 cents.
Netflix added 6.96 million subscribers, with 1.09 million of those domestic (vs. estimates of 673,800) and international subscriber additions of 5.87 million (vs. 4.46 million estimated, according to FactSet).
The company is predicting it will add 9.4 million total net subscribers in the coming quarter.
Netflix shares closed up 16.73 per cent Tuesday to $388.87 USD, up more than 80 per cent for the year as consumers continue to abandon traditional TV providers.
Original content growth
In its earnings report, the company talked about its need to expand production capacity to feed viewer appetite for original content. Netflix recently announced Albuquerque, New Mexico as the site of a new U.S. production hub, where it anticipates $1 billion dollars in production will happen over the next 10 years, creating up to 1,000 production jobs per year.
Original series released this past quarter included new seasons of Orange is the New Black, Ozark, Marvel’s Luke Cage and the debut of Insatiable, as well as limited series Maniac, starring Emma Stone and Jonah Hill. Animated adult comedies Disenchantment, from The Simpsons creator Matt Groening, and Paradise PD, from the makers of Brickleberry, also debuted.
Q3 also saw the release of original films Like Father (starring Kristen Bell and Kelsey Grammer), Sierra Burgess Is a Loser (starring Shannon Purser, aka Stranger Things’ Barb) and To All the Boys I’ve Loved Before, one of its most-viewed original films ever with strong repeat viewing.
This December, the company will support the simultaneous release in cinema and on Netflix of ROMA from Oscar-winning director Alfonso Cuarón. The film will debut online and on over 100 screens worldwide, similar to the release of 22 July, from Oscar-nominated director Paul Greengrass, which hit theatres and the streaming site Oct. 10.
Netflix says it’s committed to a member-centric simultaneous release model for its original films and welcomes additional theatre chains that are open to carrying Netflix films.
Netflix originals earned 112 Emmy nominations this year, spanning 40 shows, docs and specials, and tied with HBO for the most number of Emmy wins with 23.
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