On Monday, American streaming company Netflix Inc. (NASDAQ:NFLX) posted its fourth-quarter earnings report for 2017 that pushed its shares to trade $19 higher or 8% to trade by as much as $246.68 per share during the after-hours trading. The company posted subscriber growth that meets most analysts estimates in both the U.S. and international market.
For its fourth-quarter earnings report, the company recorded 8.3 million global subscribers making the fourth quarter the company biggest quarter in the history of the company according to the letter to shareholders provided by the company.
Earnings Report
Revenue of the company jumped by 36% during the fourth quarter to more than $11.6 billion despite non-cash charges worth $39 million the company admitted to having suffered over the fourth quarter of 2017 due to the content which has not been released and has been decided by the company to not move forward with the release. The company’s earnings came in at $0.41 per share as expected by most analysts.
Last year, Netflix has canceled a number of shows which, despite the positive reviews, has failed to garner a wide audience that led to its cancellation. Shares of Netflix rallied on news of the company cancelling shows which failed to make a profit as investors took this as a sign of the company prioritizing its earnings aside from the production of quality content.
During the last quarter of 2017, Netflix recorded 24 million new memberships compared to the 19 million new subscribers the company was able to record during the same quarter last year leading to the company being able to achieve a full-year positive international contribution profit as well as its global operating income growth during the quarter as well.
Reports have also revealed that the paid memberships have risen by 25% year over year during the fourth quarter aside from the streaming revenue growth of 3% globally. The company’s operating income came in at $245 million during the quarter beating most expectations of $238 million in terms of operating income.
In the United States, the company experienced two million new memberships beating analyst estimates that the company would bring in 1.25 million new memberships for the quarter. A total of 8.3 million new subscribers was recorded by the company for the fourth quarter.
For the first quarter of 2018, the company expects 6.35 million global net addition compared to the 5 million it predicted last year. The company intends to boost its investment in original content production this year as well as increase the price of its monthly membership.
Shares of Netflix gained by more than 8% during Monday’s after-hours trading. This led to the market capitalization of Netflix to cross the $100 billion level for the first time.