Netflix has had another excellent quarter, announcing 3.3 million new subscribers in the past three months. The company’s revenue continues to grow with £1.05 billion this quarter, but investment in originals and advertising is taking a bite out of the profit, with only £16 million reported this quarter.
Even with the profit issue, Netflix’s stock went soaring once again. The video streaming service has managed an 100 per cent rise in stock price in six months, and announced in the financial report a seven-to-one split in revenue, bringing the price back to down to $100 (£64).
Netflix said it would continue to push into new territories and lower advertising to $1 billion (£640 million) in 2016. The company plans to continue investing in original content like Orange is the New Black and House of Cards.
When speaking on rapid expansion, Netflix CEO Reed Hastings said he was fine grabbing the same amount of subscribers every quarter, rather than pushing too hard. He also said pricing was fine for the United States, although price increases could be on the way before the end of 2016.
In the United Kingdom, we have already seen a price increase from £6.99 to £7.49 per month for the two screens and HD package. The lowest price package remains at £5.99, although one screen and standard definition isn’t feasible for most families.
Netflix has plans to launch in India and China in 2016, although Hastings did not say anything about those plans in the quarterly report.