- In its half year report, Netflix has just reported a total of 10.2 million new subscribers added within the period.
Domestic net additions of 1.1m represented the highest level of Q2 net adds since the second quarter of 2011.
For Q3’17, we project that we will add 0.75m US members, compared with 0.37m in Q3’16, which was impacted by un-grandfathering.
International segment now accounts for 50.1% of our total membership base. International revenue rose 57% year over year, excluding a -$23 million impact from foreign exchange, while international ASAP grew 10% year over year on a F/X neutral basis. International contribution profit of -$13 million vs. -$69 million was better than our -$28 million forecast due primarily to higher-than-forecasted paid members.
The company said it is forecasting Q3’17 international net adds of 3.65 million. We are making good progress with our international expansion as improving profitability in our earlier international markets helps fund significant investment in our newer territories.
Netflix said it expects positive international contribution profit for the full year 2017, at current F/X exchange rates. This would mark the first ever annual contribution profit from our international segment.
For Q2, global streaming revenue was within 1% of our projection. As expected, operating margin dipped 516 basis points sequentially due to the timing of content releases, and came in at $128m on forecast of $120m.
The company said “through the first half of 2017, our operating margin was 7.1%, putting us on track for our full year target of 7%, which we plan on growing in 2018 and beyond. Q2 EPS was on target at $0.15, as a greater than expected tax benefit offset a -$64 million non-cash unrealized loss from our euro bond (which was recognized in our P&L in interest and other income/expense)”.