Netflix posts huge gains as subscriber growth soars

Lawrence Kim
October 17, 2018

Analysts keep setting the ceiling and Netflix keeps crashing through it. Both Disney and AT&T Inc. are planning to launch TV apps next year around their own premium content, amid what's already a deluge of streaming and on-demand services out there. However, Netflix CEO, Reed Hastings, also took the opportunity to talk a bit about the European Union's potential content quota plans: "The European Union is now rewriting its audio visual rules, which will eventually require subscription streaming services to devote a minimum of 30% of their catalog to European works".

The streaming giant also announced fourth-quarter subscriber growth that blew past expectations.

The withdrawal of a nostalgic and addictively bingeable series such as Friends could become a major thorn in Netflix's side.

Netflix's gains, including those that came in after-market trading Tuesday, have cleared $3.63 billion from the accounts of short sellers so far this year, Ihor Dusaniwsky, managing director at financial analytics firm S3 Partners, noted in a tweet.

Netflix is the first of the so-called Faang companies (Facebook, Apple, Amazon, Netflix and Google) to report this quarter. The company released 676 hours of new TV shows, movies and specials in the latest quarter, helping attract new customers.

The slate included new seasons of the drama "Ozark" and the animated comedy "BoJack Horseman", as well as new series "Insatiable" and "Maniac".

Earnings jumped to 89 cents per share, well above a projected 68 cents. Netflix, which expects to add another 9.4 million subscribers by the end of 2018, said its customer tally is 137.1 million.

Netflix never identifies which shows are most successful.

The Netflix logo is pictured on a television in this illustration photograph taken in Encinitas, California, U.S., January 18, 2017.

Back in July, Netflix reported lower-than-expected subscriber growth for the second quarter, and its shares into a tailspin that knocked 20 percent off their value in a month.

Netflix has staked its future growth on worldwide markets.

Analysts pointed to "solid trends" in India, where the success of homegrown shows like Sacred Games and Ghoul have helped raise its profile and hopes for future growth in the developing world's most populous markets.

Hastings, 58, suggested that he wasn't anxious about the competition.

At the same time it faces competition from the likes of Amazon and Disney.

The company, which started out in 1997 as a DVD-by-mail service, plans to spend about $8 billion on original programming this year.

Other reports by Click Lancashire

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