Netflix, Inc.(NASDAQ: NFLX) stock corrected over 6.2% in the last four days (as of August 11th, 2017; Source: Google finance) as Disney backing out from its exclusive distribution deal with Netflix as they are planning to start their own streaming service. On the other hand, the stock sentiment revamped today with the stock recovering over 1.3% (as of 3:41PM EDT; Source: Google finance). The group is still in active talks with Marvel for retaining their streaming rights to Marvel and Star Wars movies after 2019. Disney has set for to currently removing Disney and Pixar movies from the subscription service for their in-house Disney streaming offering.
On the other side, the group reported that they would acquire Millarworld, the comic book publishing powerhouse founded by Mark Millar, the legendary creator of such iconic characters and stories as Kick-Ass, Kingsman, and Old Man Logan, and one of the most important voices in comics. This partnership would offer Millarworld’s portfolio of critically and fan-acclaimed character franchises to life through films, series and kids’ shows to Netflix audience. Millarworld new content would be published under Netflix label. Netflix might continue to seek avenues to add content to offset Disney pressure in the short term. Meanwhile, the firm increased their prices for their service in Canada.
For second quarter of 2017, Netflix streaming membership the rose more than expected, from 99m to 104m, driven by content. They crossed 100m members and more international than domestic members. Global net adds reached 5.2 million during the quarter rising 5% sequentially for second quarter. Net adds rose 21% year-on-year to 10.2 million in the first half of 2017. Domestic net additions were 1.1m which is highest from the second quarter of 2011. The group expects to add 0.75m US members in third quarter of 2017 from 0.37m in Q3’16. Meanwhile, the international segment comprised over 50.1% of their total membership base with revenues rising 57% on a year over year basis excluding a -$23 million impact from foreign exchange. International ASP rose 10% on a year over year on an F/X neutral basis. The group forecast positive international contribution profit for the full year 2017, at current F/X exchange rates, which would be first ever annual contribution profit from this segment.