Netflix: Streaming Deals Like Amazon's NFL Deal Not 'Smart For Us'

Candice Alexander
April 21, 2017

Netflix, an American entertainment company is on the verge of hitting 100 million subscribers, an evidence to how much the video streaming service has differed the entertainment landscape from the time it was introduced.

Netflix added 1.42m streaming subscribers in the USA and 3.53m elsewhere in the first quarter of 2017, slightly shy of the 1.5m (US) and 3.7m (rest of the world) it had previously told analysts it expected to add. The company has done a good progress over the past five years.

In its first-quarter earnings release late Monday, Netflix Inc.

The Los Gatos, California-based company said revenue rose 34.7 per cent to $2.64-billion in the quarter. It seems most picked up on a comment management made about the company being close to passing 100 million subscribers in total. Revenue growth continued during the quarter, rising by 38.8% year-on-year to US$2.516 billion. During which, Netflix has scored 72 million more subscribers. On the other hand, the lack of big-budget productions boosted net income.

Netflix was able to beat earnings expectations, posting earnings of 40 cents per share against the Zacks Consensus Estimate of 38 cents per share.

As Netflix invests more money into creating original content and acquiring the rights to popular series and films, competitors like Hulu and YouTube are partnering up with different networks to bring a live TV streaming option to their subscribers.

Netflix's lackluster subscriber addition numbers is mostly due to its less than stellar content offerings during Q1, analysts say.

Although Netflix doesn't reveal the number of subscribers by country, Roy Morgan estimates 5.86 million Australians aged 14 and over have access to an SVOD service through 2,268,000 household subscriptions. This year, Netflix thinks it will spend about $6 billion on programming.

Free cash flow came in negative again, and the company plans to go back to the bond market in the second quarter.

Stay on topic - This helps keep the thread focused on the discussion at hand.

Share with Us - We'd love to hear eyewitness accounts, the history behind an article, and smart, constructive criticism. We now model a 17% average annual decline in total adds from 2017 to 2021 with a 21% decrease in 2017, but our projections (and consensus) may prove optimistic and problematic for the firm.

Other reports by VgToday

Discuss This Article