Last Monday Netflix
"In Q2, we underestimated the popularity of our strong slate of content which led to higher-than-expected acquisition across all major territories," Netflix said in its earnings report.
Netflix also announced that its EPS was 15 cents, given that its revenue was $2.79 billion. While analysts were "expecting earnings of 16 cents per share on $2.76 billion in revenue," Wall Street is really only interested in the subscriber numbers because that is what is going to determine its scope for future growth internationally: be it the prospect of ad revenue or even Netflix's potential use as a forum for subsidiary services, growing numbers are what win the game.
It's not all quantity over quality though; part of Netflix's success can be attributed to its popular and high quality 'originals', which have been lauded for being exceptionally innovative and well-made. So much so, that the company's work ended up at the forefront of the Emmy nominations this year, alongside HBO.
Even the App Store
CEO and Founder of Netflix Reed Hastings has also earned $300 million in the last week, rendering his net worth at $2.2 billion out of which his 3% stake in the company constitutes about $1 billion. Because of his considerable stake in the company, Hastings will only be more incentivized to ensure that Netflix produces good quality content and performs well, and a motivated and incentivized leader begets a prosperous and well-functioning organization. Leadership is very important for Netflix's long-term growth, and so long as Hastings keeps grounded, the future looks bright.
Hastings said: "I think we're just seeing the rewards of doing great content."
Last quarter's releases for Netflix entailed highly successful debut shows like 13 Reasons Why and GLOW, and new seasons of the two series that have become the company's flagship shows: House of Cards and Orange is the New Black. Netflix also pulled a new move by producing a high quality, Cannes Film Festival-screened feature film in the form of Okja, which was praised world-wide.
Investors can be sure that the high from Netflix's last quarter will be sufficient enough to carry it into an even greater era of quality entertainment, as it can funnel its surplus profits into producing even more great shows and movies.
- https://techcrunch.com/2017/07/17/netflixs-subscribers-are-surging-again-as-it-blows-away-wall-streets-expectations/
- https://techcrunch.com/2017/07/24/netflix-was-the-top-grossing-app-in-q2-with-mobile-revenue-up-233-since-last-year/
- http://fortune.com/2017/07/23/netflix-founder-reed-hastings-net-worth-increase/