Netflix stock went up $86 in one day after record-breaking quarter. The stock keeps going up and up and up. If you missed your chance to buy it when it went down to the mid 300s. You are kicking yourself now. Netflix had a record number of people signing up. HBO should be concerned. Heck, media content distribution companies everywhere should be concerned. Shares are now at an all-time-high. The thing is foreign exchange took a big chunk of the company’s profit during the first three months of the year. Investors are ignoring this fact and instead focusing on the expanded user base.
Netflix US subscribers broke through 40 million for the first time ever. Netflix also added over 20 million international members. International expansion is a major key to the continued growth of the company. So far the strategy of expanding into international markets and continued development of great original content has sucked subscribers in as well as kept them loyal. Good thing too since HBO, CBS, Dish and whole host of services are launching direct-to-consumer streaming services.
“We think both will continue to be successful in the marketplace, as illustrated by the fact that HBO has continued to grow globally and domestically as we have rapidly grown over the past five years. The attention of the new launches of the competitors is only creating a bigger ecosystem, drawing more and more people into thinking ‘Hey, I’ve got to check that out and try this Internet TV thing. ~Chief Executive Reed Hastings and Chief Financial Officer David Wells
Netflix expects to add 600,000 streaming members in the US and 1.9 million internationally in the second quarter. Both projections were better than analysts’ consensus estimates. Netflix added Australia and New Zealand. Netflix is the service’s biggest market but not its’ biggest in terms of average hours of video watched per subscriber. Think about that for a moment. All that binge watching you do is nothing compared to international market. Netflix has a very bright future if it keeps making quality shows such as House of Cards, Unbreakable Kimmy Schmidt and Bloodline. New programs like Sense8 by the Wachowski brothers of “The Matrix” fame should keep subscribers loyal.
“Linear TV has been an amazing 50-year run. Internet TV is the way that people will consume video in the future.” ~Netflix Chief Executive Reed Hastings
Netflix is doing all the right things to keep subscribers and investors happy. It’s changing its services look on TVs in the second half of the year to have more video playing. To better protect members’ privacy it’s adding the Internet protocol HTTPS. It’s the same protocol used by bank websites for its enhanced security.