By Michael Liedtke, AP
SAN FRANCISCO — Coming off its best quarter yet, Netflix is accelerating its international expansion in hopes its original programming will hook millions more subscribers on the Internet video service.
Netflix Inc. added 13 million worldwide subscribers last year, including 4.3 million during the final three months, according to figures released Tuesday in the company’s fourth-quarter earnings report. It marked Netflix’s biggest quarter of subscriber gains ever, eclipsing the 4.07 million added in the final three months of 2013.
Earnings also rose to a new quarterly high of US$83.4 million, or US$1.35 per share, a 72 percent increase from the same time last year. The latest quarter included a one-time gain of US$39 million from the resolution of a tax audit.
The performance drew rave reviews from investors as Netflix’s stock surged US$55.35, or nearly 16 percent, to US$404.15 in extended trading. The shares still remain well below their record high of US$489.29 reached four months ago.
Encouraged by the popularity of Netflix’s original programs in overseas markets, CEO Reed Hastings now expects to complete the company’s international expansion by 2017 while remaining profitable. The Los Gatos, California, company plans to borrow US$1 billion to help finance its push outside the U.S., including a potential entrance into China.
��It’s going to be a very exciting couple years,�� Hastings promised in a Tuesday interview.
Netflix also is pouring more money into original programming in an effort to maintain its leadership in long-form Internet video amid intensifying competition from imposing rivals such as Google Inc.’s YouTube, Amazon.com and Time Warner Inc.’s HBO.
The on-demand convenience of online video streaming has become so popular that HBO, a 42-year-old cable channel, will start selling a separate Internet-only subscription later this year to connect with the steadily expanding audience spurning traditional pay-TV packages. Meanwhile, YouTube has been amassing more professionally produced content to supplement its wide array of amateur videos, while Amazon.com plans to finance about a dozen full-length films for its US$99-a-year Prime service, which also includes free shipping and music streaming for its e-commerce customers.