Subscribers flood to Netflix to watch ‘The Crown’ and ‘The OA’
Streaming video service signed up 7.1m new subscribers in last quarter of 2016
Streaming video pioneer Netflix added over a third more subscribers than expected in the last quarter of 2016, a sign of success for its ambitious global expansion that sent its shares up 8 per cent in extended trading.
Netflix signed up 7.1 million new subscribers globally, far more than the 5.2 million analysts had expected, according to research firm FactSet, beating targets at home and abroad even as it raised prices. Original shows like Marvel’s Luke Cage and British drama The Crown performed strongly around the world, Netflix said, noting that competitors were adapting to compete.
Amazon recently expanded its Amazon Prime service globally, and the BBC announced plans to release entire series at once to allow the “binge watching” popularised by Netflix.
“It’s becoming an internet TV world, which presents both challenges and opportunities for Netflix as we strive to earn screen time,” the company said in its quarterly letter to shareholders.
Netflix, in its earnings report, said it added 5.1 million subscribers outside the United States and 1.9 million in its home market in the quarter ended December 31st. “The future battleground at home is now in keeping hold of customers as much as it is in trying to acquire new ones,” said Neil Saunders, head of retail analyst firm Conlumino. “In our view, the fact that consumers have readily absorbed the price increase, and that Netflix has continued to advance its subscriber numbers in spite of it, indicates the company is now firmly in pole position in the streaming arena.”
Netflix said it planned to release more than 1,000 hours of original programming this year, up from 600 hours last year. It recently signed a deal with comedian Jerry Seinfeld to stream his show Comedians in Cars Getting Coffee as well as two new stand-up specials and other shows he will develop.
The California-based company said revenue rose 35.9 per cent to $2.48 billion (€2.33 billion) in the December quarter. The company said it expected to add 1.5 million subscribers in the United States in the current quarter, fewer than the FactSet estimate of 1.79 million.
In international markets, Netflix said it expected to add 3.7 million subscribers, above the average estimate of 3.05 million.
Netflix rose as much as 8.2 per cent in after-hours trading, adding nearly $5 billion to the company’s stock market value.