Content streaming giant Netflix has surpassed 100 million active subscribers and reported a second-quarter profit of $66 million.
The company expectations for yearly revenues rose 32.3% to $2.8 billion while its total subscriber count grew 5.2 million to 104 million globally.
Claiming it “underestimated the popularity of our strong slate of content which led to higher-than-expected acquisition across all major territories,” Netflix say they’re expecting another 3.65 million new subscribers to come within the next quarter.
In a letter to shareholders, the company also emphasised their popularity in international markets.
Observing that “it seems our growth just expands the market,” and that while other services like HBO and Amazon Prime Video are expanding their own foot-prints “the largely exclusive nature of each service’s content means that we are not direct substitutes for each other, but rather complements.”
According to them, “Our international segment now accounts for 50.1% of our total membership base. International revenue rose 57% year over year, excluding a -$23 million impact from foreign exchange, while international ASP grew 10% year over year on a F/X neutral basis.”
“We are making good progress with our international expansion as improving profitability in our earlier international markets helps fund significant investment in our newer territories. As a result, we expect positive international contribution profit for the full year 2017 , at current F/X exchange rates.”
“This would mark the first ever annual contribution profit from our international segment.”
The letter also touched on partnerships whereby Netflix is sold in a package with high speed Internet and TV services, indicating more packages will be on the way.
“These arrangements are mutually beneficial – our partners gain more customers and can upsell existing subscribers to higher ARPU packages, while Netflix gains more reach and awareness with consumers across a market. We are likely to expand this approach as a complement to our direct-to-consumer primary approach.”
The letter also highlighted how the company’s recent financial fortune has come accompanied by critical acclaim.
Last week, the Television Academy nominated 27 Netflix original programs with 91 Emmy nominations, nearly double last year’s result.
The company reiterated its efforts to both “be bold in our programming choices and financially disciplined.”
They say “every show has passionate fans and committed talent striving for excellence. Sometimes those shows don’t attract as many viewers as we had hoped, compared to our other content. As much as we dislike ending a series early, it consoles us that it frees up investment for another new show, or two. We are programming to please our members and we keep that as our guiding light.”
