Netflix (NFLX) just set a powerful tone with the kick-off of the technology sector earnings season. The company blew away subscriber net additions with 5.2 million, with most investors looking for net adds around 3.2 million. The international growth was incredible at 4.14 million, while the US saw 1.07 million additions. The company noted in its release the US reading was the highest since the second quarter of 2011. For the third quarter, the company is looking for total net adds of 4.4 million. Additionally, the company issued third quarter guidance well ahead of analyst estimates. According to Ycharts, analysts had been looking for EPS of $0.22 and revenue of $2.86 billion. The company guided for EPS of $0.32 and revenue of $2.969 billion.
These results and guidance led to an 11 percent jump in the share price to an all-time around $179.
For Netflix, though this may only really be the start of their international subscriber growth ramping up.
Based on previous trends and projection based on those trends, the company could reach 70 million international subscribers over the next 4 quarters, and total subscribers of nearly 130 million by the second quarter of 2018.
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Netflix Sets The Sentiment
If the Netflix results are a sign of the future results to come, then this sector could have much further run.
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Michael Kramer and the Clients of Mott Capital own shares of NFLX.
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