The online video service Netflix has clearly exceeded all expectations with a strong growth in the last quarter. In the second quarter, about five million new subscribers were added. Analysts and Netflix themselves had expected a growth of more than three million.
The stock jumped almost nine percent on Monday after a record high to a record high of around 179 dollars. Previously, the share price had increased by 0.36 percent after the Japanese bank Nomura had expressed a positive opinion on the share and raised the price target by 10 to 175 US dollars.
The customer numbers are important for Netflix as they justify the expensive proprietary productions such as “Stranger Things” or “The Crown” with which the video service wants to differentiate itself from the competition.
Consolidated sales rose by almost one-third to almost $ 2.8 billion year-on-year, and earnings rose from $ 41 million to $ 66 million. Netflix came close to 104 million subscribers at the end of the quarter and is now also bolder in the forecasts: after the current quarter, it is already 108.35 million.
Netflix won over one million subscribers in the already heavily strapped home market of the USA in the past quarter, instead of the expected around 600,000. And internationally came more than four million, instead of the prospect of 2.6 million. This means that the rapid global expansion implemented last year is bearing fruit. Netflix has thus for the first time subscribers outside the US than inside.
“It is going to be imperative for them to have more locally produced content,” says CFRA Research analyst Tuna Amobi. “They can’t afford to pursue a ‘one-size- fits-all’ strategy. “They are becoming more like any other Hollywood studio and paying more attention to the economics of their shows.”
For the third quarter, Netflix expects an increase of 4.4 million subscribers. The turnover is expected to further increase to nearly $3 billion. Despite continued strong investments in new shows and movies in addition, the company assumes a substantial increase in profits.
“We are all co-pioneers of internet TV and, together, we are replacing linear TV,” Netflix said. “The shift from linear TV to on-demand viewing is so big and there is so much leisure time, many internet TV services will be successful.”