Netflix closed the third quarter of 2018 with results in line with analysts' expectations: revenues of 4 billion dollars, an increase of 36% compared to the same period of the previous year. What surprised insiders was the number of subscribed users which rose by 6,96 million, well over the 5,09 million expected from the estimates and thus reaching 130 million paying users and 137 million total users.
At an operating level, Ebitda stood at 584 million compared to 273 million in the third quarter of 2017, up by +114%, and thus pushing net income by 210% to 403 million dollars, when last year it was equal to 130 million.
The net earnings per aduste share is equal to 89 cents, also above the estimates which instead gave it at 68 cents. In 2017 they stood at 29 cents per share. Finally, the company's guidance for the fourth quarter estimates revenues up 27% to 4,2 billion, an increase of 15% to 7,6 million paying users and 13% to 9,4 million total subscribers.
The gross operating margin, on the other hand, should decrease from 7,5% in the fourth quarter of 2017 to 5%, bringing the 2018 Ebitda margin between 10 and 11 percent. A drop to be attributed above all to the timing of production expenditures and the release of more original films in the latter part of the year. The results above the expectations of the stars and stripes analysts pushed the Netflix stock into after-hours trading, where yesterday it gained 15% (+3,8% at the end of the session, before the release of quarterly data.
The circulation in the quarterly data caused the stock to jump on Wall Street where Netflix gains 10 percent at the start of the premarket, while yesterday before the quarterly release it stood at +3,98%.
