Netflix Inc. Sees Jump in New Users

Netflix Inc. Sees Jump in New Users

Netflix Inc. just had a very good day. The company went beyond what it had originally forecast. The number of new subscribers for the September quarter was much higher than what Netflix had anticipated. The results reassured Netflix Inc. investors. Up to now, the investors were reserved about the growth potential of the streaming company. But the news that Netflix had outdone itself when it came to signing up new users gave the company a boost. Netflix  Inc. shares went up on the stock market by 20 percent in after-hours trading.

Netflix Inc. Does Much Better than It Was Expecting

The performance was better than expected. Netflix Inc. did particularly well in international markets. This year, the company completed a massive expansion. Netflix carried out a plan that took its streaming business global. The angle that the company is using is the same that they have used in the United States. A combination of edgy original content plus library programming that was successful on the US market. The brains behind the expansion are betting that this mix is going to do just as well overseas.

So far, Netflix has outdone itself. The projections for the expansion were for about 2 million new users. In the last quarter, the streaming giant signed up 3.2 million new international subscribers.

In the Unites States, Netflix also did very well. In the same time frame, the company added 370,000 new subscribers. It had forecast just 300,000 new users for this quarter. So the results are 20 percent ahead of the forecast. Compared to how the company did at the same time last year, the results are below that. But last year saw 880,000 new additions as the market was maturing. Many people were signing up for streaming services like Netflix, Hulu and Amazon.com.

Wall Street Reacts to Netflix Improvement

The reaction on Wall Street shows that investors don’t exactly know what to make of the company’s expansion plan. As Netflix is moving into many new countries all at once, investors are uncertain about the possible outcome. This kind of business outlook leads to a volatile expectations game.

This time a year ago, the company’s performance was not as good in terms of international subscribers. The number for last year’s September quarter was 2.74 million new additions from international subscribers. But the company has expanded significantly in the meantime. Since then, Netflix has launched in over 130 countries. So the potential for growth went up exponentially.

In the previous quarter, Netflix had missed its own internal estimates for new subscribers added to the service. The business did not grow as fast as executives were expecting. After the disappointing results became public, stock in Netflix went down 13 percent on the market. Netflix CEO Reed Hastings went out and apologized to investors for the volatility of the company’s stock. On Monday, as Netflix stock was going up on the market, CEO Reed Hastings was smiling.

 “We can all see it’s time for me to apologize for the volatility again.”

Said Netflix CEO Reed Hastings.

But this time with a different attitude to accompany his words. A winning attitude.

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