Shares soar as Netflix smashes new subscriber targets in quarter

SHARES IN Netflix Inc rose 9 per cent to a record high in pre-market trading on Tuesday after the video streaming service trounced Wall Street targets for new subscribers in the fourth quarter.

In a statement after markets closed on Monday, Netflix said it added 6.36 million subscribers in international markets in the fourth quarter, beating analysts’ expectations of 5.1 million, according to FactSet.

It now has 117.58 million streaming subscribers globally.

“Overall, this was a ‘home run quarter’ for Netflix and should put any lingering worries to rest around sub(scriber) growth, international ramp, and the ‘negative’ possible effects from the (subscription) price increase,” GBH Insights analyst Daniel Ives said.

The company, which showcased popular returning series

and in the quarter, in October hiked its monthly fees for US customers for the first time in two years.

“The subscriber growth validates management’s ongoing content investment, and should contribute to comfort with 2018’s increased $7.5-8.oB content spend and associated marketing to support the content slate and ever-growing library,” Canaccord Genuity analyst Michael Graham said.

Netflix and its peers Hulu and Amazon.com’s Prime Video are steadily increasing budgets for producing original shows as they gain market share from traditional cable TV providers.

Netflix spent $90m on Will Smith action movie last year, its largest investment in an original film to date, and is already planning a sequel