Netflix streaming revenue exceeds $2b, company calls this the 'golden age of content'
Netflix released its quarterly global earnings today and announced that streaming revenue is at $2.2b for the first time in the company's history (up 36% year over year), helped by its strong content including Stranger Things and the second season of Narcos.
For Netflix, the third quarter earnings represents 39% year-over-year revenue growth, a 400 basis point acceleration from the last two quarters. Global streaming revenue totaled $2.2b, of which 40% was generated abroad. Operating income amounted to $106m (compared with a $64m estimate) while net income was $52m (vs. forecast of $22m).
Netflix has clearly had a strong year with 12m global members added in the first nine months of 2016. The company wrote in their letter to shareholders that "with more revenue, we can reinvest to further improve Netflix to attract new members from around the world, while continuing to delight our existing customers."
Netflix's content was one of its key strengths this year with the launch of Stranger Things and Narcos. Stranger Things proved to be the blockbuster of the summer and is also notable as it is produced and owned by Netflix, the company said. In August, the company launched Get Down, a highly stylized drama set in 1970s New York City, detailing the origins of hip-hop. Their hit series Narcos had great success among critics and had a positive impact on member acquisition across all of our markets, demonstrating the ability for tent pole franchises to connect with audiences across the world.
"We are fortunate that our Internet-centric, on-demand, subscription-only business model allows us to support programs for both mass and niche audiences alike. Our personalization algorithms help us promote the right content to the right viewers. And since we are not shelf-space constrained nor reliant on advertising, we have the luxury to tell all kinds of stories in less traditional ways," the company wrote.
"The growth of Internet TV globally has ushered in a new golden age of content, with consumers everywhere enjoying unprecedented access to amazing amounts of high quality programming."