Netflix Profit Climbs 22%, Subscribers Up 26% in Q2

Authored by Mark Hefflinger on July 24, 2009 - 5:12am.

Los Gatos, Calif. - Online DVD rental service Netflix (NASD: NFLX) announced this week that it added 289,000 new subscribers during the second quarter, a 26% increase year-over-year, and now counts 10.6 million subscribers. The company reported $408.5 million in revenue, up 21% from a year ago but just shy of the $409 million projected by analysts.

Profit was up 22% on the strong subscriber growth, to $32.4 million.

Netflix plans to spend more to acquire the rights to stream movies and TV episodes, a recent feature that has proven popular with subscribers.

The company said to expect operating margins to remain at 10% as it ramps up its spending on licensing, and noted that the lack of content is what is preventing the company from launching a standalone streaming service.

"We don't have all the [streaming] content we have on DVD," Netflix CEO Reed Hastings said in a call with reporters, according to PaidContent.

"Our subscribers want streaming-only, but with a lot of content, so for now, they're happy with the mail/streaming hybrid."

Related Links:
http://snipurl.com/nvend

http://snipurl.com/nve8g (PaidContent)

http://www.netflix.com