AnMaster.com

Alexkid

Netflix adds 510,000 more customers as DVD-by-mail service delivers another strong quarter
By MICHAEL LIEDTKE
AP Technology Writer
(AP) 05:01:30 PM (ET), Thursday, October 22, 2009 (SAN FRANCISCO)
Netflix Inc. has been doing so well during the recession that it's getting tougher for the DVD-by-mail pioneer to live up to investors' lofty expectations.

Following a familiar script, Netflix on Thursday delivered third-quarter earnings and revenue that exceeded estimates as it added another 510,000 subscribers during its traditionally sluggish season.

What's more, management forecast that customer and earnings growth for the fourth quarter would be better than executives envisioned three months ago.

"Our business momentum is strong and our third-quarter performance keeps us solidly on course for a record 2009," said Reed Hastings, Netflix's chief executive.

Netflix shares still plunged by nearly 4 percent in extended trading.

The reaction suggested investors had been betting on an even more optimistic outlook from the Los Gatos, Calif.-based company.

Netflix projected fourth-quarter earnings of 38 cents to 47 cents per share, up from the previous range of 36 cents to 44 cents per share. Analysts surveyed by Thomson Reuters had predicted earnings of 43 cents per share for the quarter.

In the third quarter, Netflix posted net income of $30 million, or 52 cents per share. That was up 48 percent from the same time a year ago.

Revenue climbed 24 percent to $423 million.

Netflix shares $1.88, or 3.8 percent, to $47.75 in extended trading. Before the release of results, shares gained $1.78, or 3.7 percent, to close Thursday at $49.63.

The company's stock price has more than doubled in the past year, largely because Netflix's combination package of DVD rentals and video streamed over the Internet has emerged as a popular attraction among consumers looking to save money by keeping themselves entertained at home during tough times.

Netflix's most popular plans cost $9 to $17 per month.

In the past year, Netflix has add 2.4 million subscribers _ the biggest burst of growth in the service's 10-year history. Netflix ended September with 11.1 million subscribers. Management expects to attract another 900,000 to 1.2 million customers in the current quarter.

Netflix's success is one of the reasons that Blockbuster Inc., the largest U.S. video store chain, has drawn up plans to close as many as 960 stores by the end of next year.

But not all of Netflix's competition is retreating. It's facing a stiffer challenge from Redbox, which has been winning over bargain shoppers with in-store kiosks that rent recently released DVDS for $1 per night.


--------------------------------------------------------------------------------
* Netflix is taking it to Blockbuster !
Invest ? *

__________________
Yeah...Do That.