Netflix destroyed earnings expectations yesterday, delivering EPS of $0.73 versus street consensus $0.58. It also beat on revenue, generating $876 million over $857 million expected.
Beyond the numbers, the company finally seems to have put the Qwikster debacle behind them and is seeing positive subscriber growth again. The streaming business notched 220k net additions and the overall subscriber base grew 4% with higher than expected international adoption.
Which is not to say the company is completely in the clear. Content costs are rising, margins are eroding with the shift to streaming, and compeition among video streaming services is heating up. Yesterday the New York Post reported that Amazon is looking into starting its own standalone steaming service, which Netflix said they expected on the earnings call. Amazon may not be the only big company looking to launch its own service soon too, as we discussed back in December.
Nonetheless, yesterday’s earnings report raises confidence again in the execution prowess of Reed Hastings and company, who were a model of how to manage a transforming business before a year of PR disasters they’d rather soon forget.