Netflix topped earnings expectations Thursday, reporting that profit and subscriber ranks grew as its heavy bet on a rich content line-up paid off amid a crackdown on password sharing.
The leading streaming television service said it gained 9.3 million subscribers in the recently ended quarter, raising the total to 269.6 million.
Netflix reported a profit of $2.3 billion on revenue of nearly $9.4 billion in the quarter, compared to a net income of $1.3 billion on $8.2 billion in revenue in the same period a year earlier.
“Netflix continues to lay the smackdown on its competition,” said Emarketer senior analyst Ross Benes.
“This signals that password sharing was even more common than previously thought as Netflix keeps converting freeloader viewers into paid users.”
Company shares slipped more than 4 percent to $581 in after-market trades, apparently due to the company saying sales in the current quarter might be less than market expectations.
Netflix shares have climbed since the start of this year, but investors seemed wary of the company’s ability to keep pumping up revenue and develop its nascent ad-supported tier into a meaningful money-maker.
The company launched an ad-subsidized offering last year around the same time as the crackdown on sharing passwords outside of homes.
Netflix is still in early days of building its ad business, and it remains a work in progress, according to co-chief executive Greg Peters.
