Netflix Sees More Gains After an Excellent Quarter

Netflix posted its strongest start to a year since the company went public 16 years ago, thanks to fast growth in markets across Latin America and Europe, according to Bloomberg.

The company added 7.41 million subscribers in the first quarter of the year, according to a statement, easily topping analysts’ projections. Netflix now has 125 million paying customers, the most of any online TV network.

The company, the best-performing stock in the S&P 500 this year, is proving one quarter at a time that investors’ confidence in its online TV service has been justified. Netflix is using its growing subscriber base and deep pockets to poach talent from the biggest program suppliers and build a Hollywood studio for the internet age.

Netflix said first-quarter profit rose to 64 cents a share, from 40 cents a year earlier. That met analysts’ projections of 64 cents. Sales for the quarter grew 40 percent to $3.70 billion, compared with Wall Street projections of $3.69 billion. For the current quarter, Netflix is predicting earnings of 79 cents and revenue of $3.93 billion. That compares with analysts’ estimates of 65 cents a share in profit and sales of $3.89 billion.

The company has told investors it will save money by bringing development and production in-house and avoiding the markups imposed by rival studios. But spending is still growing as the company expands production in areas like film, unscripted series and kids programming. Total streaming content obligations grew to $17.9 billion in the first quarter, up from $17.7 billion three months earlier, and that doesn’t account for the ballooning budget to market shows.

Netflix said it now makes about as many unscripted shows as any cable network. The company already makes more movies than any studio, with about 80 on tap for all of 2018, and more than one stand-up special a week.