On Monday, American streaming giant Netflix Inc (NASDAQ:NFLX) is expected to deliver its fourth-quarter earnings report. During the previous quarter, the company delivered its third-quarter earnings report that beat analysts estimates. The growth was then projected to push through until the year 2018 following a massive consumer growth despite the announcement of the company regarding its plans to raise the price of its monthly subscription.
From posting earnings of $0.37 per share on a revenue of $2.98 billion during the third quarter, the company is expected to post earnings of $0.41 per share on a revenue of $3.2 billion. The company also has an outlook of recording 6.3 million new subscribers globally despite the indication that its current subscribers may see further price hikes in the future leading to an increased revenue outlook for the company.
2017 Growth
During the past year, the shares of the company have traded over 70% and is trading around $222.55 per share recently. The streaming giant has grown tremendously last year following the back to back success of its original content boosted by growing subscribers globally as well as a number of other efforts including cutting content which has not contributed to the growth of the company.
Netflix announced back in 2017 that it plans to invest $6 billion in the production of original content that year as it proved to be one of the primary growth drivers for the company. Netflix then announced that it plans to increase this investment to $7 billion this 2018. This pushed the shares of the company higher following various reports of other entertainment and streaming companies boosting their efforts is able to compete with Netflix.
The company also surpassed 100 million subscribers back in July last year following an additional 5.2 million subscribers globally with four million coming from outside the United States. Profits of the company have then jumped by more than 60% to $66 million by October.
Strong Annual Expectations
This year, the original content produced by the company is expected to send the shares of the company to trade higher as well as drive subscriber growth globally. While Netflix is expecting a slight decline in its subscriber growth globally, there is currently an expectation that the company may still record as much as 1.25 million subscribers this year.
However, the company’s growing audience is still expected to contribute largely to its profits with expectations that the company’s net income will hit $183 million just during the fourth quarter representing $0.41 EPS compared to their earnings of $0.15 per share during the same quarter last year.