Netflix has signed up a record 7.5 million new domestic and international customers in the fourth quarter in the very first year of the company being a global online TV service.
The company has added a whopping 5.12 million new customers in international markets, beating analysts' estimate of 3.78 million. And the California âbased company has added 1.93 million new domestic customers, exceeding projections of 1.38 million.
The shares of the company jumped to an all-time high in late trading. Since expanding to 130 new countries last January, Netflix Netflix has delivered strong international gains and could see foreign subscribers exceed its US base this year.
"Given its ever-growing programming budget, the company will need the cash flow that these additional subscribers can provide," said Paul Sweeney, a Bloomberg Intelligence analyst.
First-quarter earnings will be $US165 million, or 37 cents a share, an early sign that Chief Executive Officer Reed Hastings will deliver on his promise of material profit in 2017.
The world's largest paid video service bet its future on globally replicating its success in the US, where it has almost 50 million customers, sacrificing near-term profit while spending heavily on programming and marketing to build a global TV audience. Netflix said its long-term budget for programming summed up to $US14.5 billion at the end of year.
Hastings' global online TV service still has a long way to go in matching its US performance worldwide. While Netflix has signed up almost half of the available market at home, it hasn't reached that percentage in even its strongest foreign territories, such as the UK and Canada.
The popularity of the new period drama on Netflix The Crown, a reboot of Gilmore Girls and a new season of its sci-fi series Black Mirror is mainly responsible for Netflix's humongous super success.
This success has given the company a fresh confidence regarding the one concern that worries the company the most - unfettered access to internet.
Hastings has been one of the loudest advocates of net neutrality. Though, President-elect Donald Trump has suggested that he might undo net neutrality, Netflix says it's entrenched enough to not feel threatened. Netflix still argues that it needs to foster innovation.