Netflix (NFLX) shares are trading higher after hours on following the company’s� Q3 results.
For the quarter, the company posted revenue of $553.2 million, ahead of the Street at $550.9 million. GAAP EPS of 70 cents a share was a bit shy of the Street consensus at 71 cents. Adjusted EPS was 78 cents a share slightly beat expectations. The company finished the quarter with 16.9 million subscribers, up 13% sequentially and 52% year over year. Gross margin was 37.7%, down from 39.4% in Q2.
The company said 66% of its subscribers watched streaming videos in the quarter, up from 61% in Q2 and 41% a year ago.
Netflix said subscriber acquisition costs fell to $19.81 in the quarter, down from $24.37 in Q2, and $26.86 a year ago. Churn fell to 3.81%, from 4.0% in Q2, and 4.4% a year ago.
For Q4, the company now sees ending subscribers at 19 million to 19.7 million, up from a previous estimate of 17.7 million to 18.5 million. The company now sees Q4 revenue of $586 million to $598 million, up from $580 million to $596 million. The company continues to see Q4 EPS of 59-74 cents a share.
NFLX in late trading is up $9.57, or 6.3%, to $162.72.
Note: The post has been updated to reflect that Street estimates were based on GAAP results, rather than adjusted results.
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