What happened
Shares of Netflix (NASDAQ: NFLX) shot higher by 55% last year, a result that trounced the 19% rise in the broader market, according to data provided by S&P Global Market Intelligence .
The increase lifted Netflix to a market capitalization of more than $80 billion -- up from $2 billion a decade ago when it launched its streaming video service.
So what
The business dramatically outperformed expectations in 2017, with subscriber growth clocking in at 15.5 million over the first three quarters compared to management's forecast of 13 million. That result has kept Netflix on pace for another year of accelerating membership gains as its global base pushes further past 100 million.
Image source: Netflix.
Profits are improving at the same time, thanks to price increases and the popularity of high-definition streaming plans. Netflix is on pace to push its profit margin above 7%, from less than 4% in 2016.
Now what
CEO Reed Hastings and his team projected that the company would add 6.3 million users in the recently completed fourth quarter, with most of those gains coming from international markets. The next quarterly report, due in late January, will cover much more than just subscriber gains, though.
Netflix will also update investors on the next steps in its profitability plan, now that it has hit management's goal of roughly doubling operating margin in 2017. The company could also issue an eye-popping content spending forecast; it laid out close to $8 billion last year as it bet more aggressively on producing its own shows and movies.
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Demitrios Kalogeropoulos owns shares of Netflix. The Motley Fool owns shares of and recommends Netflix. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
