Netflix said today that the web's top video-rental service generated revenue of $1.07 billion, and added 630,000 new domestic streaming subscribers during the company's second quarter.
Netflix also reported that for the quarter ended June 30, net income was $29 million or 51 cents per share. During the same period last year, Netflix earned 11 cents a share on revenue of $889 million. Analysts on average expected Netflix to report revenue somewhere around $1.07 billion and earnings of $0.40 per share. The company had projected it would add between 230,000 and 880,000 new U.S. subscribers this quarter.
Analysts were looking for a big quarter from Netflix. This was the period that Netflix's original programming, such as the revived former Fox show Arrested Development, was supposed to attract a boatload of new subscribers. Last week, Netflix's original shows were nominated for a total of 14 Emmy awards, including one for Kevin Spacey, star of the show House of Cards. In its letter to shareholders, the company said it typically expects subscriber growth to decline year over year in the second quarter, but that, "This Q2, however, was an exception, we believe due to the launch of Arrested Development."
The second quarter has seen Netflix's stock price soar. Since the company beat earnings expectations in the first quarter, its share price has risen more than 60 percent. But in after-hours trading today, investors appeared disappointed over the ho-hum subscriber growth. Netflix shares was down about 6 percent to $246 a share.
Netflix gave a report card for some of its competitors by noting that Hulu and Amazon appeared to have the same number of viewers: 4 million. Netflix's management also took notice of the $750 million investment that Hulu's owners plan to make in their Netflix competitor. "Hulu has more money to spend," the company said in the letter. "Content prices may rise further, but we have many multi-year deals in place to mitigate this."
Netflix, for the first time, is skipping the traditional analyst call in favor of a live interview on CNBC. You can follow along below: