Netflix adds more subscribers despite price hike
NETFLIX had over 50 per cent more subscribers than expected in the third quarter as original shows such as Stranger Things drew new international viewers and kept United States customers despite a price hike.
Netflix added about 3.2 million subscribers internationally in the third quarter, higher than the 2.01 million average analyst estimate.
In the US, Netflix added 370,000 subscriptions, compared with analysts' estimate of 309,000, according to research firm FactSet StreetAccount.
The company broke a two-quarter trend of disappointing subscription growth.
Netflix, which has spent heavily to expand outside its home market, said it was on track to start harvesting "material global profits" next year, even as it raised spending on original programming.
It has expanded into more than 130 markets worldwide, including most major countries, except China.
It said on Monday it was dropping plans to launch a service in China in the near term, opting instead to license its shows for "modest" revenue.
The company said it still hopes to launch service in China "eventually".
Netflix has been facing a slowdown in subscription growth in the US as the market matures and a planned US price hike raised concerns it would not hit its targets.
It also faces competition from Hulu and Amazon.com.
But the company, whose other popular original shows include Orange Is The New Black and House Of Cards, said it expects to add 1.45 million subscribers in the US in the current quarter.
In its international markets, it expects subscriber additions of 3.75 million.
Netflix plans to keep pouring money into building its stable of original and licensed TV shows and movies.
Content spending will rise to US$6 billion (S$8.3 billion) next year, a US$1 billion increase from this year, the company said.
"We will keep investing in growing the content spend, even domestically, for quite a long time," chief executive Reed Hastings said on webcast.