Netflix Inc. (NASDAQ: NFLX) continues to bolster its subscriber count continuously every quarter, as total membership count increase by over 5 million globally for its third quarter. Shares rallied in after hours on Monday as shares surged and hit an all time high of over $208.
For the third quarter of the fiscal year 2017, Netflix reported an EPS increase of $0.29 per share, falling short of Thomson Reuters’ estimates of $0.32, but a 58 percent increase year over year. Revenue reported was $2.98 billion, beating Thomson Reuters’ estimates of $2.97 billion, and a 30 percent increase year over year.
Netflix’s subscriber count grew by 5.3 million globally in the third quarter alone, beating Street Account’s estimates of 4.5 million. Subscription count has now increased 49 percent year over year. Globally alone, Netflix added on 4.4 million members. Netflix reported that the company now has over approximately a total of 109 million subscribers.
The surge of subscriptions generated a net income of $130 million, representing a 60 percent increase year over year from $52 million.
For the fourth quarter, Netflix has forecasted revenue of $3.27 billion, which would represent a 32 percent increase year over year. Thomson Reuters’ analysts estimate revenue to be $3.15 billion. The company forecasts an EPS $0.41 compared to Thomson Reuters’ analysts estimates of $0.35.
The increase in forecast for revenue can be contributable to Netflix’s decision to raise subscription prices will be in effect throughout the fourth quarter. Netflix increased pricing for most of the subscription plans nearly 10 percent or more.
Although even with the increased membership plan, Netflix is still forecasting to add on even more subscribers, as the company forecasts for 6.3 million (1.25 million in US and 5.05 million globally). Street Account analysts’ estimate for 6.25 million subscriber increase.
Year over year, Netflix’s shares have risen over 100 percent, as shares broke over $200 last week.
Netflix is also outperforming the other tech giants in its FANG sector, or companies known as Facebook Inc. (NASDAQ: FB), Amazon.com Inc. (NASDAQ: AMZN), and Alphabet Inc. (NASDAQ: GOOGL).
Netflix is performing more double the rate of the second highest performer, Facebook. Netflix is performing at over 100 percent on a year over year basis, more than 60 percent higher than Facebook.
The promising third quarter can assure investors and shareholders that the fourth quarter can provide just as top of the line, if not even better than the third quarter.
The company plans to use $17 billion in the next several years to grow its library of owned content, the company says it remains “quite comfortable with its ability to please its members around the world.” Netflix will spend $7-8 billion on content in 2018.
"Our future largely lies in exclusive original content that drives both excitement around Netflix and enormous viewing satisfaction for our global membership and its wide variety of tastes." said Netflix to its shareholders.