Netflix Earns $2.7 Million in Latest Quarter and Surpasses HBO's Subscriber Count in U.S.
UPDATED: The service took in revenue of $638.6 million and added 2.03 million new streaming subscribers in the U.S. Shares surge 21 percent after the closing bell.
Netflix said Monday it earned $2.7 million in the latest quarter, up from a loss of $4.6 million a year ago, and that it added enough new streamers in the U.S. to make it a bigger TV network, if one can call it that, than HBO.
Revenue came in at $638.6 million, up from $506.7 million last year.
The results impressed Wall Street, and Netflix shares, which had already advanced 11 percent during regular trading, soared an additional 21 percent after the closing bell. In after-hours trading, Netflix stock was up $37.02 to $211.39.
At a conference call with analysts that is scheduled for later today, CEO Reed Hastings is expected to offer intelligence on how its original show, House of Cards, has performed for the company.
The company added 2.03 million streaming subscribers in the U.S., up from the 1.74 million it added a year ago. Its total domestic streamers is 29.2 million, while HBO has 28.7 million subscribers in the U.S.
Hastings previously wrote on his Facebook page that subscribers watched 4 billion hours of streaming content during the first quarter, prompting an analyst to declare Netflix the "most-watched cable network."
In a letter to shareholders, Hastings seemingly gave House of Cards, a political thriller starring Kevin Spacey and Robin Wright, at least some of the credit for bringing new streaming customers to Netflix. He also insinuated that Netflix has no intention of backing away from further original programming.
"On February 1, we premiered all 13 episodes of House of Cards to enormous popular and critical acclaim," Hastings wrote. "The global viewing and high level of engagement with the show increased our confidence in our ability to pick shows Netflix members will embrace and to pick partners skilled at delivering a great series."
Hastings also said that Netflix's decision to launch all 13 episodes on the same day proved effective, as it "created enormous media and social buzz." He also said that speculation people would sign up for a free month just to watch all of House of Cards then cancel, proved unfounded. "Less than 8,000 people did this, out of millions of free trials in the quarter," he wrote.
In a research not, SIG analyst Vasily Karasyov said he expected Netflix to add just 1.44 million new domestic streamers during the quarter. "We think Netflix shares will react positively to stronger than anticipated (first quarter) results," he wrote.