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Netflix stock soared close to 20% this afternoon after the company reported quarterly earnings and subscriber growth that easily topped analysts' expectations. All in all, the streaming giant took in a record $2.15 billion in revenue, up 36 percent over last year, while adding 3.6 million new subscribers — plenty more than the 2.3 million it had projected.
Specifically, Netflix added 3.2 million international subscribers, and 370,000 domestic subscribers, up from the expected 2 million and 300,000 respectively. Total subscribers are up to an impressive 86.7 million as the company further distances itself from rivals.
Netflix attributed its stellar performance to the of its original content strategy, with hit series like Stranger Things and the second season of Narcos. While original content requires more cash upfront it pays off over time through licensing and syndication fees. It’s also free of the licensing mess that is third party content when it comes to international availability.
According Netflix CFO David Wells, the streaming service wants to fill 50 percent of its library with original shows and movies within the next few years. It will be up to 600 hours of original programming by the end of 2016 and will bump to a whopping 1,000 hours in 2017.
Looking toward the fourth quarter, Netflix is a little more optimistic with a goal to add 5.2 million net memberships: 1.45 million in the U.S. and 3.75 million internationally.