Netflix blows by estimates, adds 7.4M subscribers in Q1

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Shares of Netflix (NFLX - Free Report) surged almost 9% in morning trading Tuesday as investors continue to digest the company's latest quarterly earnings report. That figure has almost doubled in two years - faster than Netflix revenue growth over the same period. Facebook shares plunged in recent days after the social media company disclosed a data breach that affected up to 87 million users. Both figures in the latest quarter came in above analysts' average estimate. Last week, Comcast agreed to include Netflix subscriptions in more of its cable packages, opening up a way for Netflix to connect with hard-to-reach potential new members, even though the two waged a public battle against each other in 2014 over net neutrality. Look at its top three institutional owners. It operates in three segments: Domestic Streaming, International Streaming, and Domestic DVD.

A number of other equities research analysts have also recently commented on the company. Wells Fargo & Company MN raised its stake in Netflix by 22.5% in the 4th quarter.

New shows like "Altered Carbon" and "O Mecanismo" helped Netflix smash analysts' subscriber estimates, and its better-than-expected second-quarter outlook soothed concerns about competition from Apple Inc and Amazon.com Inc. That result also easily surpassed our NFM estimate, which called for global contribution profits of $234 million.

LOS ANGELES-Netflix Inc. 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.

Netflix plans to continue increasing its marketing spend, both in the USA and around the world, making it one of the largest advertisers in the media and technology space. The company tries a lot of new things and does not appear tied down to any specific way of approaching content. But spending is still growing as the company expands production in areas such as film, unscripted series and kids programming. "Our output in this area is now comparable to similarly-focused US domestic cable networks".

"We strive to entertain and to bring joy to people across the world through awesome stories", it read.

Netflix this year won its first Academy Award this year for the documentary "Icarus" on doping in sports.

Netflix's content strategy may appear arbitrary at a distance, but the streaming behemoth has clearly developed a strategy that resonates with its audience and refuses to stay stagnant.

Looking to the current quarter Netflix expects to add another 6.2 million net subscribers and is looking at revenues of $US3.9 billion as the benefits of last year's price rises flow through to the bottom line. The firm has a market capitalization of $62.15 billion, a PE ratio of 335.79 and a beta of 1.27.

Total revenues of $3,602 million are now weighted in favour of the United States, but it is anticipated that this will be eclipsed by worldwide revenues in the next quarter. Revenue surged 43% in the period. Make sure to follow @Ryan_McQueeney on Twitter! The company only needs to raise about $2 billion in debt now, which, even at a 6% rate, means $120 million more in annual interest costs. They're now bigger than Morgan Stanley, Goldman Sachs and even Visa!

In non-earnings news, Southwest Airlines fell 1.1 per cent after investigators reported a fatality following an emergency landing of a Southwest plane in Philadelphia. MarketWatch has called the growth "stunning", and it's just that.

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