Netflix hits high, adds 1.7 million users
Netflix adds 1.7 million subscribers, an 11-year record, sending shares to a new high.
By Jeanine Poggi, TheStreet
Netflix (NFLX) shares reached an all-time high on Thursday, a day after it said it added 1.7 million subscribers in its first quarter, its biggest gain in new users in its 11-year history.
The DVD-by-mail retailer had a stand-out first quarter, increasing earnings 44% to $32.3 million, or 59 cents a share, from $22.4 million, or 37 cents, a year earlier. Analysts were calling for earnings of 54 cents a share. Revenue jumped 25% to $493.7 million from $444.5 million.
Netflix ended the quarter with almost 14 million subscribers. The company predicted it would add 1.2 million to 1.5 million subscribers during the quarter.
Another positive for Netflix: Hulu, the television streaming site, will reportedly begin charging its users for some of its content.
Despite the solid quarter, Netflix forecast second-quarter earnings that could fall short of Wall Street's forecast. The company expects a profit of 62 cents to 73 cents a share and revenue between $517 million and $525 million. Analysts predict earnings of 68 cents on revenue of $516.2 million.
There is also one word of caution: Netflix will eventually run out of households it can sign up when the installed base reaches 29 million, Needham analyst Charles Wolf wrote in a note.
Shares of Netflix climbed 16% to $100.87 as of 2 p.m., hitting a record of $102.49. The stock has soared 83%, outperforming the 24% advance of the S&P 400 Consumer Discretionary Index.
Copyright © 2014 Microsoft. All rights reserved.
Puma Biotechnology shares soar after it says it wants to file for marketing approval of an experimental breast cancer drug.
VIDEO ON MSN MONEY
Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.
Contributors include professional investors and journalists affiliated with MSN Money.
Follow us on Twitter @topstocksmsn.