Netflix 'on track' for $11bn revenues after quarterly beat

Video-streaming group Netflix said it was "on track" to top $11bn worth of sales in its current financial year as the firm boosted its revenue 30% over the three months leading to 30 September.

Netflix picked up 4.45m new subscribers in its third quarter, well ahead of analyst expectations of 3.69m, bringing earnings to a total of $273m throughout the quarter, as opposed to the $164m over the same time period a year earlier.

The Californian group said that while it had "a good head start" its job was to improve the company as rapidly as possible in order "stay ahead of the competition in decades to come".

Netflix announced that as part of its "improvement" programme it had planned to spend as much as $8bn on new serialised programmes and films in 2018, an increase on the almost $6bn spent in its current trading year that had left analysts cautiously optimistic already.

While Netflix dipped into its cash reserves in the third quarter to cover operating activities, it spent just $420m compared to $535m outgoing it recorded in the previous quarter.

Earlier this October, Netflix announced it would be raising prices on both its standard and premium subscription services.

The changes, which were set to go into effect later in the year, would see the monthly cost of its most popular plan jump just $1 a month from $9.99 to $10.99.

"It's really about slow and steady. We've been in no hurry," said David Wells, Netflix's chief financial officer when asked about the timing for the price hike. "Many investors have sort of criticized us in the past for being under-priced."

As of 0925 BST, Netflix shares had gained 1.60% in after-hours trading to $202.68 each.