Netflix Inc. (NASDAQ: NFLX) reported first-quarter 2016 results after markets closed Monday. For the quarter, the video distribution company posted adjusted diluted earnings per share (EPS) of $0.06 on revenues of $1.81 billion. In the same period a year ago, the company reported EPS of $0.05 on revenues of $1.57 billion. First-quarter results compare to the Thomson Reuters consensus estimates for EPS of $0.03 and $1.97 billion in revenues.
In the company’s letter to shareholders, Netflix says U.S. streaming subscriber numbers grew to 45.71 million. Internationally, streaming subscriber numbers grew by 4.55 million to 31.99 million. Total subscribers now number 81.5 million, up by more than 6 million sequentially and just short of 20 million year over year.
The quarterly subscription growth in the first quarter was a little better than expected, but what’s sinking the stock in after hours trading is the company’s forecast.For the second quarter of 2016, Netflix expects to add just 500,000 new subscribers in the U.S and 2 million internationally. Margins in the U.S. are expected to be flat in the second quarter and internationally the company expects the first quarter’s net loss of $104 million to improve due to favorable currency effects.
As previously announced Netflix is ending its grandfathered $7.99 subscription. The company’s DVD service counted 4.7 million customers at the end of the first quarter and $72 million profit.
Netflix shares are down nearly 9% in after-hours trading at $98.74 in a 52-week range of $78.89 to $133.27. Shares closed today at $108.40. Thomson Reuters had a consensus analyst price target of $123.66 before today’s report.
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