Netflix Inc (NFLX)

[badbadbad]

Netflix earnings: 40 cents vs. 37 cents per share expected
Netflix reports first-quarter earnings
Subscriber growth is a key metric for analysts
EPS expected to hit 37 cents per share, according to a Thomson Reuters estimate
Anita Balakrishnan | @MsABalakrishnan
27 Mins Ago
CNBC.com
11
SHARES
Netflix posted first quarter earnings that beat expectations, and revenue that was in line with analysts' estimates on Monday. But the stock tumbled as the company added fewer subscribers than expected.

- EPS: 40 cents vs. 37 cents per share expected by a Thomson Reuters estimate

- Revenue: $2.64 billion vs. $2.64 billion expected by a Thomson Reuters estimates

Reed Hastings, chief executive officer of Netflix Inc
Joan Cros Garcia | Corbis | Getty Images
Reed Hastings, chief executive officer of Netflix Inc
Wall Street watching subscribers, spending

Netflix's stock hit an all-time intraday high at the end of March, as investors bet that the company's aggressive spending on original content and international expansion will continue to be outweighed by rapid subscriber growth.

In January, Netflix had forecast adding 5.2 million subscribers in the first quarter — 1.5 million domestic streamers and 3.7 million internationally.

Subscriber growth is a key metric for analysts. Domestic growth can signal that the company's core market has yet to mature, analysts said, while the international market has shown the most rapid new growth prospects.

Wall Street is known for its volatile reactions to Netflix's earnings — CEO Reed Hastings has even apologized for the stock's volatility in past earnings releases. In 13 of the past 20 of Netflix's quarterly earnings reports, the stock has closed either up or down by 10 percent or more, according to FactSet data.

As of last year, Netflix was by far the most-watched streaming service in America, at 52.6 million American households, according to Nielsen data obtained by CNBC. By comparison, Amazon had about 25.2 million homes, Nielsen estimated.

The California-based company is now dumping cash into original content to maintain its dominance over its growing field of rivals. Netflix said in the fall that it plans to spend $6 billion on content this year, above last year's predicted spending from companies like Amazon and CBS. Netflix also said in January it plans to produce 1,000 hours of premium original content this year — even as tech giants like Apple try their hand at original shows.

Still, the company's cash burn has been a concern for some on Wall Street.

"We continue to believe that Netflix cash burn is important and is largely overlooked by investors," Wedbush analyst Michael Pachter said in a note ahead of the earnings release.

This is breaking news. Please check back for updates.

What are technology stocks doing? Track the sector here.

Anita Balakrishnan
Anita Balakrishnan
News Associate
RELATED SECURITIES

http://www.cnbc.com/2017/04/17/netflix-earnings-q1-2017.html