Netflix stock is exploding higher to new all time highs, a repeat of what it did last quarter, soaring above its all time high price, up over 9% above $247 per share after reporting Q4 numbers which while beating slightly on revenues ($3.29Bn, Exp. $3.28Bn), and beating modestly on non-GAAP EPS (Adj. EPS$0.41, exp. $0.41), were far more remarkable for the subscriber numbers, which absolutely smashed expectations especially on the international streaming side, as follows:
- Q4 domestic net streaming additions 1.98MM; Wall Street exp. 1.29MM, guidance 1.25MM
- Q4 international net streaming additions 6.36MM, Wall Street exp. 5.05MM, guidance 5.05MM
The addition of 8.4 million subs in Q4 was the company's largest ever quarterly increase.
Netflix' Q1 2018 outlook was also far above expectations, with the company now expecting Q1 net streaming adds of 6.35 million (1.45MM in the US and 4.9MM internationally) well above the consensus estimate of 5.18 million, although this will come at a cost: Netflix expect to burn between $3 and $4 billion in cash in 2018.
The company expects $3.686 billion in Q1 revenue, also above the consensus estimate of $3.49 billion, generating EPS of 63 cents, above consensus of 55 cents.
Also, it will come as no surprise that with Wall Street expecting the company to spend $8.7 billion this year on content…
… it will continue spending an ungodly amount. Netflix now has 117.6 million subscribers worldwide, but the success has come at a steep price and as of Sept.30, NFLX's total content obligations were a record $17 billion.
