Netflix in 1Q18
Netflix (NFLX) announced its 1Q18 results on April 16, 2018, and posted slightly better-than-expected earnings and revenues. In 1Q18, Netflix posted adjusted earnings of $0.64 per share, exceeding analysts’ consensus of $0.63 per share. The company posted total revenues of $3.7 billion, slightly better than the estimate of $3.69 billion. Its earnings and revenues increased ~60.0% and ~40.0% year-over-year, respectively.
The streaming giant added ~7.4 million subscribers in 1Q18, with total global subscribers of 125.0 million. Its subscriber additions crushed the analysts’ forecast of 6.5 million subscribers.
Netflix’s rise in stock price despite Facebook concerns
Netflix’s (NFLX) stock price closed at $307.78 on April 16, down 1.2% for the day. The company’s stock closed up more than 6.0% in after-hours trading after the earnings announcement.
Year-to-date (or YTD), Netflix’s stock price has risen more than 60.0%, while the S&P 500 Index was almost flat. Among Netflix’s peers, Comcast (CMCSA) and the Walt Disney Company (DIS) declined 15.5% and 6.7%, respectively, on a YTD basis.
Notably, the recent concerns over Facebook’s (FB) Cambridge Analytica breach had a substantial effect on many tech stocks as well as the broader markets. The issue emerged on March 19 and significantly hurt the stock.
The so-called FAANG stocks—Facebook, Amazon, Apple, Netflix, and Google parent Alphabet (GOOGL)—fell 16.2%, 3.7%, 4.1%, 5.9%, and 11.6%, respectively, between March 12 and March 29 over Facebook’s data breach issue. The FAANG stocks comprise more than 11.0% of the S&P 500 Index.