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Netflix Q4 2016 Earnings: Trial but no error for Netflix original content

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It’s onwards and upwards for Netflix as the company delivers another impressive quarter.

Netflix added nearly 2 million new domestic subscribers and 5 million new international subscribers during the fourth quarter of this year. In addition however, it seems that Netflix’s international growth is skyrocketing as it focuses more on local shows that carry across a larger audience.

The company continues to invest heavily in U.S.-based original content, though understands that while that strategy will attract new users, it’s the wide variety of licensed content that convinces most users to stick around long term.

Netflix generated $8.3 billion USD in total streaming revenue, with U.S. streaming revenue accounting for a large portion of those profits. While total global streaming revenue reached $2.4 billion on 15 cents per share in the fourth quarter of 2016, U.S. revenue compiled half of that with revenues of $1.4 billion.

In contrast however, international streaming revenue continues to steadily climb, with totals reaching $948 million this past quarter. Operating profit totalled $154 million ahead of an estimate of $125 million. Net income amounted to $67 million.

Netflix has put in play a number of strategies to ensure that these numbers keep increasing quarter after quarter. For one, the company is just beginning to consolidate its original content plan with its international markets.

International audiences likely have different tastes than the service’s North American base, which suggests that original content will need to be produced for each culture. A prime example of this is a the recent Netflix-produced Brazilian sci-fi, post-apocalyptic thriller, “3%,” that became one of the most-watched shows in Brazil. 

In addition however, Netflix became the top-grossing iPhone app on the App Store this past December for the first time ever, despite its recent trend of slow domestic growth. Netflix also added offline viewing to its mobile products this past quarter, which likely helped to improve the growth of its iOS and Android apps.

Netflix forecasts its Q1 2017 revenue to reach $2.5 million.

[source]Netflix[/source]

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