Shares are up about 2% in early post-market trading, though probably mostly due to subscriber gains — topping 50M streaming customers worldwide for the first time — rather than the financial results for Q2. Netflix generated $71M in net income, up from $29.5M in the period last year, on revenues of $1.34B, +25.4%. While the growth is impressive, it was also expected: Revenues came in just a little ahead of the $1.33B that analysts anticipated. Earnings at $1.15 a share were a penny shy of the consensus forecast.
But the company says it had 36.24M domestic streaming customers at the end of the quarter, up 570,000 from March, which it attributes to “our ever-improving content offering, including Orange Is The New Black Season 2.” Netflix expects an additional 1.33M in Q3. On the international side, streaming customers increased by 1.12M over the three-month period to 13.8M. But the company lost 342,000 DVD-by-mail customers, ending the quarter with 6.17M.
Investors probably will overlook most of these numbers as they wait to hear what CEO Reed Hastings will tell analysts later today about Netflix’s European expansion plans, Fox’s effort to buy Time Warner, and policy matters including the FCC’s proposals to promote net neutrality. “Our policy goals are for the FCC to not sanctify paid prioritization, and for the [Justice Department and FCC] to block the merger of [Comcast and Time Warner Cable], or at the very least, to require as a condition to approving the merger that the combined entity be prevented from charging for interconnection,” Hastings and CFO David Wells say in a letter to shareholders.