Netflix revenue surges 24%; subscriber additions nearly double
It used to be Hollywood that was recession-proof. Now it's Netflix.
Continuing its huge growth in the midst of a brutal recession, the DVD-by-mail subscription company increased its revenue by 24% last quarter and added a net 510,000 subscribers, 95% more than it did in the same three months last year.
Netflix's big gains underscore that it is one of the key drivers, along with $1-a-night DVD kiosk company Redbox, in the 9.9% growth in total rental revenue for the home entertainment industry in the third quarter.
The Los Gatos, Calif., company reported net income of $30.1 million, up 48% from a year earlier, on revenue of $423.1 million. The total number of subscribers as of Sept. 30 was 11.1 million, up from 8.7 million a year earlier.
All three numbers were on the upper edge or slightly over the guidance Netflix provided to its investors three months ago.
Most significant for those who own Netflix stock, the company modestly increased its financial projections for the end of the year from those it provided in its last earnings report. The company expects to have 12 million to 12.3 million subscribers, up from previous guidance of 11.6 million to 12 million. Revenue is projected to be $1.666 billion to $1.672 billion, up from $1.65 billion to $1.67 billion, and net income guidance is $106 million to $111 million, compared with its previous prediction of $99 million to $109 million.
Netflix stock was up 4% before earnings were announced but is down slightly in after-hours trading.
-- Ben Fritz
Photo: Netflix Chief Executive Reed Hastings. Credit: Randi Lynn Beach / For The Times.