LONDON: Netflix Inc. NFLX reported third-quarter earnings after the market closed on Monday, sending shares higher after a record closing high.
The company’s subscriber growth beat expectations as did revenue, though profit came in lighter than expected.
Executives are expected to discuss recent price hikes and their effects in a later interview; past price increases have had significant impacts on the company’s subscriber numbers.
The Los Gatos, Calif., company ended its third quarter with 104 million paid streaming subscribers globally. It added 5.3 million streaming users in total, outpacing the 4.4 million net additions it had projected.
Netflix has been pouring money into original programs such as “Stranger Things” and “The Crown” to fend off competition from other streaming services and continue to attract new subscribers around the world. The company now says it plans to spend as much as $8 billion on content next year – up from an earlier estimate of $7 billion – far outstripping the investments expected from rivals Hulu, Amazon.com Inc. and HBO.
Revenue increased 30% to $2.99 billion in the third quarter, slightly topping analysts’ estimates, and the company’s operating margin expanded.
Shares in Netflix rose 1.2% in after-hours trading Monday. The stock has gained 64% this year though Monday, giving the company a market value of about $87.5 billion.
The company said it now has $17 billion in streaming-content obligations, a measure of current and future costs for content acquisition, licensing and production, an increase from $14.4 billion in the same quarter last year.