Netflix, which fell short of its own subscriber projections by 1 million last quarter, added a total of 7 million subscribers during the third quarter.
Subscriber growth is paramount and in this category, Netflix didn't disappoint.
"The question at the end of Q2 was whether that miss was an aberration or signs of a longer-term slowdown in the business", said Forrester Research analyst Jim Nail. The July letdown sent Netflix stock plunging more than 10 percent, prompting some to speculate that the company may have peaked. Nor does the company release viewership figures for programs, contending that subscriber growth demonstrates the popularity of its entertainment slate.
That paid off in terms of new subscribers.
Global territories remain the key to the company's future, and accounted for 84 percent of Netflix's new customers in the third quarter.
In the current quarter, Netflix is forecasting net new subscribers of 9.4 million, including 1.8 million new subscribers in its domestic market and 7.6 million in worldwide markets.
Executives said audiences welcomed shows tailored to specific markets, such as "Sacred Games" in India, which the company identified as key to its expansion. Netflix added 5.15 million subscribers in the second quarter of 2018, missing management's original forecast for 6.2 million. "We're just going to focus on that for a very long time".
The Silicon Valley company has been ramping up its investment in original programming as it faces increased competition from rivals like Hulu and Amazon, and traditional media firms begin to enter the market for streaming and limit content to outside parties. It has issued a net $7.5 billion of bonds in less than three years, though that could carry a cost in a changing economic environment. The company had previously projected $3 billion to minus $4 billion.
Profit in the quarter more than tripled from a year ago to $403m while revenues grew 34% to $4 billion. Net income came in at 89 cents per share, beating Wall Street's number by 21 cents a share.
Netflix is not looking to diversify to other areas for now, and is unlikely to feel compelled to for years to come, Reed told the post-earnings interview.