Netflix Beats Expectations As the Streaming Giant Continues to Grow

Earnings season is officially here and many analysts have their eye on Netflix. The streaming entertainment company published their fourth-quarter results today and the company reported continued growth.

Netflix revealed that the company’s global streaming revenue has grown 41% from 2015 to 2016 to over $2 billion. In addition, operating profits reached $154 million, which was higher than the company predicted.

In addition, Netflix added over 7 million net subscribers in the quarter, which was a little higher than 2 million members than the company initially predicted. The entertainment company pointed out that this quarter was the largest quarter of new subscribers in the company’s history. In fact, within the U.S., the streaming giant added 1.93 million members this quarter and increased revenue by 27% in comparison to 2015. Meanwhile, international membership grew by 5.12 million in the fourth quarter, again beating expectations.

Netflix
The Cast of “Stranger Things” arrives at the Weinstein Company and Netflix 2017 Golden Globes After Party on Sunday, January 8, 2017 at the Beverly Hilton Hotel in Beverly Hills, CA. (CarlaVanWagoner / Shutterstock, Inc.)

Netflix also explains that they are learning how to determine the best content for their audiences around the world. The company points out the success of shows like Marvel’s Luke Cage, The Crown, and Black Mirror were able to globally entertain audiences. In addition, Trollhunters was the company’s most-watched original kids programming. Furthermore, Netflix’s first Brazilian original series 3% did exceptionally well. In turn, making it the most watched original show in Brazil and in other Latin American countries.

“We continue to invest in local programming to complement our content offering and as a means to introduce new members to our global library,” Netflix explained in their earnings report. “We are focusing on local content that travels pan-regionally or across multiple territories, such as Japanese anime and Turkish dramas,” the streaming company added.

The streaming giant did point out that while Net Neutrality is important from a public policy standpoint. However, the company does not believe they would be financially impacted, which is important because many analysts believe the end of net neutrality could have disastrous consequences for the company, if enacted.

In addition, Netflix pointed out their biggest competition lied with Facebook’s growing presence of video, the possibility of Apple branching off as a video content provider, and essentially media becoming a TV to internet diaspora.

So what’s next for Netflix?

The company projects that in the next three months the streaming giant will gain more nearly another 9 million subscribers globally. In addition, the company predicts memberships will increase following their upcoming content line-up in the second half of 2017. Moreover, the streaming giant will invest over $6 billion on content, which is an increase of $1 billion in comparison to 2016.

Netflix stock price rose by 7.8% on Wednesday evening in after-hours trading.