Netflix (NFLX) Shares Jump on Strong Q3 Results, Sharply Raised Subs Outlook

October 20, 2010 4:46 PM EDT
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Netflix Inc. (NASDAQ: NFLX) shares are jumping in extended trade after the company reported that its third-quarter income grew 26 percent and it continued to add subs.

The company reported third-quarter earnings of $38 million or 70 cents per share, up from $30.1 million or 52 cents per share in the same quarter last year.

Excluding one-time charges, the company earned 78 cents per share, 7 cents better than the analyst estimate of 71 cents per share.

Revenue for Netflix jumped 31 percent to $553.2 million from $423.1 million last year, beating the market consensus of $550.9 million.

The company said that it added 16.9 million subscribers in the quarter, up 52 percent from the same time last year.

Looking forward, Netflix sharply raised its fourth-quarter subscribers guidance from 17.7-18.5 million to 19-19.7 million.

The company raised its fourth-quarter earnings guidance to a range of 59 cents to 74 cents from a prior view of 58 cents to 73 cents per share, compared to the Street's view of 74 cents per share.

Netflix also raised its fourth quarter sales guidance to a range of $586 million to $598 million from a prior view of $580 million to $596 million.

for the full year, the company narrowed its earnings guidance from $2.58-$2.86 per share to $2.68-$2.83 per share, which compares to the Street estimate of $2.79 per share. Sees full-year sales of $2.15-$2.16 billion, below the consensus of $2.17 billion.

Shares of Netflix are up 6.50 percent to $163.11 in aftermarket movement on Wednesday.

UPDATE: Click here to see some highlights from Netflix's Q3 conference call.

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