In a letter sent to its shareholders (PDF), Netflix reported excellent results for its most recent earnings report. In Q4 2010, the company saw revenue of $596 million, an operating income of $78 million, and a net income of $47 million.

What we find most interesting is that the company now has 20.01 million subscribers, adding 7.7 million in 2010, 3.08 million of which signed up in the past quarter alone. Here's how last year measured up to previous years, and how the company is describing its growth:

Our extraordinary growth of 7.7 million net subscriber additions for 2010 underscores the momentum of the business. At the start of 2010, our best estimate for net additions for the year was about 3.6 million, which shows how hard annual forecasting is when the opportunity is expanding so rapidly. Part of what makes forecasting subscriber growth challenging is we continue to improve our service, which creates a better value proposition and expands our market opportunity.

Netflix continues to strike new deals, add more content, and plan overseas expansion. The company could end up seeing competition from Amazon, however, which recently purchased Lovefilm, often referred to as the European Netflix.