The shares of Netflix Inc (NASDAQ:NFLX) surged after hours on Wednesday after the largest online video streaming company posted outstanding financial results for the fourth quarter.
The stock price of the company closed at $333.73 per share, but suddenly climbed more than 17% to $392.50 per share during the extended hours trading. A clear demonstration the investors were happy with the financial performance of the company. The net income of Netflix Inc (NASDAQ:NFLX) increased six times compared with its results in the same period a year ago.
Fourth quarter financial results
During the fourth quarter, the online video streaming company generated $48 million net income or $0.78 earnings per share compared with its $8 million net income or $0.13 earnings per share in the same quarter in 2012.
Netflix Inc (NASDAQ:NFLX) said its revenue from $945 million a year ago to $1.18 billion. Its operating income was $82 million, up from $20 million last year. The company has $5 million free cash flow by the end of the quarter compared with -$51 million in the fourth quarter of 2012.
During the quarter, Netflix Inc (NASDAQ:NFLX) added 2.33 million domestic subscribers to 33.42 total members. According to the company is domestic paid members were 31.71 million. Its international members grew by 1.74 million to a total of 10.93 million. Its international paid members were 9.71 million.
The online video streaming company ended the year 2013 with more than 44 million total members, and expects to increase the number to 48 million by the end of the current quarter.
Netflix Inc (NASDAQ:NFLX) indicated that it is hoping to eventually offer a selection of three simple pricing options for new members. The company had been testing three different plans with various price points since late last year.
The company said, “If we do make pricing changes for new members, existing members would get generous grandfathering of their existing plans and prices, so there would be no material near-term revenue increase from moving to this potential broader set of option.” Netflix Inc (NASDAQ:NFLX) said it will not rush the implementation of new member plans, and it still researching the best way to proceed.