Netflix on the verge of hitting 100 million subscribers


Netflix finished the first quarter of this year with 98.75 million subscribers and predicted that its ranks would crest 100 million this weekend.

Netflix now has 98.75 million subscribers, up from 81.5 million previous year. This is a bit less than the company's own projections that saw it predict 5.2 million subscribers in the first quarter - 1.5 million in the US and 3.7 million internationally.

Over the past ten years what really did it for Netflix was the emergence of phones and tablets that enabled people to watch videos with mobility, said Wedbush Securities analyst Michael Pachter. "But Netflix clearly had a vision before those devices became so ubiquitous". In the first quarter, Netflix net subscribers were standing around 1.42M in the US, compared to the consensus estimate of 1.59M and 1.93M in Q4. Netflix ended March with almost 48 million subscribers outside the U.S.

Almost 10 years after Netflix began offering online streaming of movies and TV shows, the company says it's all set to hit the 100-million subscribers mark. The company told shareholders that such services are likely to be more directly competitive to existing MVPD services rather than Netflix. The company, based in Los Gatos, California, has lined up a slew of high-profile releases in the coming months, including new seasons of "House of Cards", "Orange Is the New Black" and "Master of None".

For all its success, Netflix still has a ways to go to catch up with HBO, the popular pay-TV channel that has served as its role model.

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In the U.S., Netflix is expected to grow its audience to 128 million individual users this year, capturing 66 percent of the over-the-top (OTT) - as in over-the-Internet - viewing market, according to digital analytics firm eMarketer (which also estimates that there are 2.5 viewers for every 1 paid subscription). Plus, there is CBS All Access, Sling TV and DirecTV that are also offering streaming entertainment options as well.

"If you look across the 12-month trend, we've still got a lot of great growth", Netflix Chief Financial Officer David Wells said on a conference call with analysts.

Announcing its performance, Netflix said that it had generated somewhere around $2.64 billion in revenue and $0.41 earnings per share for the fourth quarter of 2016.

In terms of the competitive environment with the launch of YouTube TV in the U.S., for example, Hastings said such services may appeal to a subset of the same population that doesn't subscribe to a pay TV bundle. The actual figure came in at 4.95 million additional subscribers. Despite a five point drop in its stock price this morning, Netflix is now up a little over three per cent. It lost some long-time US subscribers after their rates went up by as much as $2 per month a year ago. Q1 was the first quarter of consolidated profit for our worldwide segment as profit growth in our more mature territories offset investments in newer markets. Analysts predict Netflix will make $482 million on revenue of more than $11 billion for the entire year.

There is always, however, the question of whether Netflix will try to up the prices again as its original programming production costs spike. When you look at the last 5 years, everyone's anxious every quarter about saturation in the USA, and we just continued to grow.