Netflix Profit Soars On Subscriber Growth, Stock Up 10%

(RTTNews) - Shares of Netflix Inc. (NFLX) surged over 10 percent in extended trade Monday, after reporting a surge in profit for the third quarter, driven largely by strong subscriber base growth. Quarterly earnings topped Wall Street estimates, as did revenues. The online video service provider also provided an upbeat outlook for the fourth quarter.

Netflix added 1.3 million domestic subscribers taking the total number of subscribers to 31.1 million at the end of the September quarter. Netflix attributed the growth to its strong content offering, which includes the new hit series "Orange is the New Black." Netflix has been investing in movie rights and new original shows to improve its subscriber base. The company also added 1.44 million international streaming customers, ending the quarter with subscriptions totaling 9.2 million.

Revenues for the quarter grew to $1.11 billion from $905.1 million last year. Analysts estimated revenues of $1.10 billion for the quarter.

Los Gatos, California-based Netflix's third-quarter profit soared to $31.8 million or $0.52 per share from $7.7 million or $0.13 per share last year. On average, 29 analysts polled by Thomson Reuters expected earnings of $0.49 per share for the quarter. Analysts' estimates typically exclude one-time items.

Looking forward to the fourth quarter, the company expect earnings in the range of $0.47 to $0.73 per share. Analysts currently expect earnings of $0.46 per share for the quarter.

Netflix expects to improve its domestic subscriber base to a range of 32.7 million to 33.5 million, and international subscribers to 10.1 million to 10.9 million.

NFLX closed Monday's trading at $354.99, up $21.49 or 6.44%, on the Nasdaq. The stock further gained $34.75 or 9.79% in after hours trade.