Netflix Q4 Earnings: Subscribers Soar And Operating Profits Double

Netflix (NFLX) has released its fourth-quarter earnings report, revealing details about its subscriber numbers and annual growth revenue.

According to the shareholder letter from the company, Netflix added a total of 8.8 million subscribers during the quarter, taking it to a total of 139 million paying members. This is up from the 7.6 million subscribers that the company predicted earlier in the quarter and up 29 million from the beginning of the year.

Annual revenue for the company came in at $16 billion in 2018, up 35 percent from the previous year with operating profits doubling to $1.6 billion.

Also included in the shareholder letter was information about viewership of some of its more popular titles, including "Bird Box." According to Netflix, the movie is estimated to be viewed by more than 80 million households within the first four weeks of appearing on the streaming platform. As many as 45 million accounts streamed the movie in the first week alone, which set a new record for the company.

Other popular titles rising to the forefront for Netflix include "You" and "Sex Education." The two shows are on pace to be viewed by more than 40 million accounts in the first four weeks of viewing. Views of Netflix content are only counted if an account watches 70 percent of a show or movie, according to the company.

“As a result of our success with original content, we’re becoming less focused on 2nd run programming,” Netflix said to shareholders.

“We are ready to pay top-of-market prices for second run content when the studios, networks, and producers are willing to sell, but we are also prepared to keep our members ecstatic with our incredible original content if others choose to retain their content for their own services.”

Even more detailed statistics were provided from Netflix including its U.S. market share of 100 million hours of viewing per day. The company also discussed its competition saying that it loses more viewers to Fortnite than other streaming platforms such as HBO.

“There are thousands of competitors in this highly-fragmented market vying to entertain consumers and low barriers to entry for those with great experiences,” the company said. “Our growth is based on how good our experience is, compared to all the other screen time experiences from which consumers choose.

“Our focus is not on Disney+, Amazon or others, but on how we can improve or experience for our members.”

Going forward, Netflix said it is planning for a 9 percent operating margin in Q1 of 2019 as it looks to grow revenue faster.

Shares of Netflix were down 1.84 percent as of 12:51 p.m. ET on Friday.