The trade war between the United States and China has lasted for more than one year — and a resolution is nowhere in sight.World Economyread more
The Fed is expected to cut rates Wednesday, but it is unlikely to tell markets what they want to hear on future rate cuts.Market Insiderread more
Pelosi said Trump should not have tried to address China's trade practices in a way that opened Americans up to financial pain.Politicsread more
Investors await the Fed's latest decision on monetary policy, set to be released on Wednesday stateside. The U.S. central bank is widely expected to cut rates by 25 basis...Asia Marketsread more
TransferWise posted an annual net profit of £10.3 million on revenues of £179 million.Technologyread more
Live the high life with a night's stay at Highclere Castle, the iconic stately home made famous by Downton Abbey.Spendread more
Large banking institutions face the risk of failure if interest rates in Europe continue to stay negative, warns the global chief economist of the Economist Intelligence Unit.Banksread more
The fallout from two fatal crashes of Boeing 737 Max planes has ensnared the manufacturer's most-loyal customer: Southwest Airlines. The carrier has canceled thousands of...Airlinesread more
Brent crude oil jumped the most in history in the previous session after attacks on Saudi's oil industry disrupted the kingdom's production.Marketsread more
In the survey, conducted after the third in the Democratic Party's series of debate, the former vice president draws 31% compared to 25% for the Massachusetts senator. At 14%,...2020 Electionsread more
Stocks rose slightly on Tuesday, but gains were capped as the Federal Reserve kicked off a two-day monetary policy meeting.US Marketsread more
Netflix fell about 1% after reporting its first-quarter earnings after the bell Tuesday. The company posted quarterly revenue that beat estimates but included light guidance for the following quarter.
Here are the numbers Netflix reported compared to Wall Street's expectations:
Netflix revenue rose 22.2% year over year, reporting $4.52 billion compared with $3.70 billion a year earlier. Earnings per share climbed from 64 cents in Q1 2018 to 76 in the same quarter this year, marking an 18.8% increase.
Netflix provided light guidance for the second quarter. The company estimated Q2 earnings per share of 55 cents compared with the 99 cents analysts were expecting, per Refinitiv.
Netflix said its Chief Marketing Officer Kelly Bennett will retire this year. Chief Content Officer Ted Sarandos will run both content and marketing in the interim during the search for a new CMO.
"We don't anticipate that these new entrants will materially affect our growth because the transition from linear to on demand entertainment is so massive and because of the differing nature of our content offerings," Netflix wrote, comparing the shift from linear viewing to streaming to that from broadcast to cable in the 1980s and 1990s. "We believe there is vast demand for watching great TV and movies and Netflix only satisfies a small portion of that demand."
Disney will pull its movies from Netflix this year to stream on its own new service, Disney+ instead. But CEO Reed Hastings said on a live-streamed earnings interview following the report that he's unconcerned about the loss of content from third-parties and is focused on building up Netflix's own original content library.
"We've expected this decline of second window content, been ready for it, anticipating it," Hastings said. "In fact we're eager to be able to have more and more of our money to be able to do spectacular new titles."
Netflix reported net cash flow for the quarter of negative $380 million compared to negative $287 million during the same period last year. The company said it now expects its 2019 free cash flow deficit to be greater than the negative $3 billion previously expected, coming in at negative $3.5 billion. Netflix said the larger deficit was due to a change in corporate structure and investments in real estate and infrastructure.
The company previously said cash flow would remain consistent in 2019 compared with last year's total of negative $3 billion. Netflix said it still expects free cash flow to improve next year and the years after. The company previously said 2019 will be its peak for cash burn, after which it expects it to fall.
Netflix addressed its recent price hikes in its letter to shareholders, saying the response in the U.S. "so far is as we expected and is tracking similarly to what we saw in Canada following our Q4'18 increase, where our gross additions were unaffected, and we see some modest short-term churn effect as members consent to the price change."
The company announced just before its last earnings report that it would raise the price of its basic plan from $8 to $9, boost the price of its most popular HD standard plan from $11 to $13, and bump its 4K premium plan from $14 to $16. Netflix had previously raised prices three times, which seemed to have little effect on subscriber growth while boosting the stock price.
Netflix also discussed some of its top-performing content in its letter to shareholders. The documentary, "FYRE: The Greatest Party That Never Happened" was watched by more than 20 million member households in its first month on the service, Netflix said. The scripted series "Umbrella Academy" has been watched by 45 million member households in its first four weeks, according to Netflix. The company also mentioned some of its industry awards, including several Oscars for its feature film "Roma."
On the earnings interview stream following the report, Sarandos said the company will soon disclose more of these stats around its content.
"Over the next several months, we're going to be rolling out more specific granular reporting, first to our producers and then to our members and of course to the press over time," Sarandos said, adding that Netflix will "be more fully transparent about what people are watching on Netflix around the world."
He also addressed a question about Netflix's strategy around showing content in movie theaters. The company has previously butt heads with movie theater owners who prefer to show their content exclusively for a period of time, while Netflix prefers shorter exclusive runs to get content on their service faster.
"If I had my way I would love to have the movies that are on Netflix be available in 2,000 theaters at the same time that they're on Netflix. We just don't control the programming of those theaters," Sarandos said. "We have to focus on making great movies and then anyone who's involved in the ecosystem of presenting movies and watching movies will have to take notice of those films."