Reed Hastings’ Netflix monster is getting bigger and stronger — and is working on plans to bulk up even more.
The streaming video giant said Wednesday it added 2.33 million US subscribers in the fourth quarter — more than most on Wall Street had expected — bringing its total domestic customer base to 31.7 million.
News of the better-than-expected growth pushed the shares of the Los Gatos, Calif., company up 18 percent in after-hours trading, to a new all-time high of $393.67.
Profit margins, now 23.4 percent for its US business, could pass 30 percent in 2015, the company said.
CEO Hastings bullishly forecast that subscriber growth in the current quarter would hit 2.25 million — surpassing the gains in the year-ago period.
At the same time, the company outlined plans for power growth down the road — including getting inside set-top boxes, shrinking movie release windows and adding more original productions and international territories.
Netflix’ 31.7 million paying US customers is more than HBO’s 28 million, Showtime’s 23 million and the 22 million who subscribe to Starz.
Net income for Netflix in the quarter also surprised Wall Street, rising to $48.4 million, or 79 cents per diluted share.
The Street expected 64 cents. Revenue for the fourth quarter was in line with expectations, at $1.175 billion.
Hastings was dressed in a casual zippered beige sweater on a video stream Q&A with analysts. The stream, unfortunately, broke down in the middle of questions.
That might have been the only low-light of the afternoon.
Hastings said the company is making progress toward set-top-box integration that would make Netflix as instantly available as CBS. Currently, viewers need either a SmartTV or a console to connect Netflix to a large TV screen.
Netflix content boss Ted Sarandos said that with the line between TV and movies becoming increasingly “blurry,” the best way to break down the one-year delay between a movie release and its arrival on TV is to “do it yourself” — that is, to produce original big-budget movies.
Hastings also brushed aside any concern about added costs or streaming troubles as a result of the federal court ruling on net neutrality.
If major ISPs want to contemplate blocking or slowing some traffic, it would simply invite more government intervention, Hastings said.
As usual, Hastings didn’t pass up the opportunity to needle HBO. Asked to comment on HBO boss Richard Plepler’s recent remark to Buzzfeed that it’s OK for people to share HBO GO passwords, the 53-year-old CEO quipped that Plepler’s password to Netflix is “NetflixBitch.”
The joke stunned the Twitterverse. HBO had no comment.
Netflix didn’t add much clarity to its testing of new price tiers.
Hastings, saying perhaps one price didn’t fit all — the $7.99-a-month price allows each account to stream on up to three devices — recently introduced a $6.99 option that allows for one device.