Price increases and membership gains drove profit growth, Netflix says
Netflix reported second-quarter earnings Thursday that beat analyst expectations on profit, with earnings per share of 80 cents compared to the 79 cents analysts had forecast in a FactSet poll. Revenue of $12.56 billion grew 13% from $11.08 billion a year earlier but came in just below the $12.58 billion analysts had anticipated.
The company attributed the profit growth to new membership signups and price increases, which Netflix said “had gone well and as expected.” The price adjustments, along with subscriber additions, pushed net income to $3.4 billion from $3.13 billion in the year-ago period, a 9% increase.
For the current quarter, Netflix forecast revenue growth of about 12%, a pace that would fall short of the approximately 13% growth analysts are expecting, with third-quarter revenue projected at about $13 billion. The modest outlook appeared to drive the after-hours selloff, with shares dropping $5.33 to $69.02, a decline of 7.2%.