Online-video streaming service Netflix Inc (NFLX), Wednesday reported a decline in first-quarter profit, hurt largely by foreign currency impact even as revenue climbed on the back of some better-than-expected subscriber growth. Revenues for the quarter were in line with Wall Street estimates.
Looking ahead, Netflix detailed some weak earnings outlook for the second quarter, due to the expected content expenses related to Australia and New Zealand.
The continued strength in Netflix's subscriber base lifted the company's stock by 12 percent in after-hours trade on the Nasdaq.
Netflix, based in Los Gatos, California, said it added 4.9 million streaming subscribers globally in the first quarter, above its forecast of 4.1 million, to end the quarter with 62.3 million subscribers.
The company added about 2.3 million customers in the U.S. during the quarter, and 2.6 million internationally. For the second quarter, Netflix expects to add 2.5 million customers globally.
The video-streaming service provider has turned its focus to expand in international markets as it faces strong competition in the US. In March, Netflix forayed into Australia and New Zealand.
Netflix said it would add several new films and TV series, and will also take off some cult and classic movies off its list.
"We think strong U.S.. growth benefited from our ever-improving content, including the launch of the third season of House of Cards and new shows Unbreakable Kimmy Schmidt and Bloodline," the company said.
Netflix reported first-quarter net earnings of $23.7 million or $0.38 per share, compared with $53.1 million or $0.86 per share last year.
The company said foreign currency hurt its profit by $33.7 million in the quarter. Excluding this impact, adjusted earnings for the quarter were $0.77 per share, compared with $0.72 per share a year ago.
On average, 37 analysts polled by Thomson Reuters estimated earnings of $0.69 per share for the quarter. Analysts' estimates typically exclude special items.
Netflix said its revenues for the first quarter were higher at $1.57 billion, compared with $1.27 billion in the prior year. Thirty-six analysts had a consensus revenue estimate of $1.57 billion.
For the second quarter, Netflix expects earnings of $0.26 per share, while analysts expect $0.90 per share.
NFLX closed Wednesday at $475.46, down $3.25 or 0.68%, on a volume of 5.6 million shares on the Nasdaq. In after hours, the stock gained $56.54 or 11.89% at $532.00. In the past year, the stock has traded in a range of $299.50 - $489.29.
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