Sina Technology News, in the early morning of July 17, Beijing time, the US video streaming service provider Netflix announced financial reports today that the company's revenue for the second quarter of FY2020 was US$6.148 billion, up 24.9% from US$4.923 billion in the same period last year; net profit was US$720 million, up 166% from US$271 million in the same period last year. Netflix's second-quarter revenue exceeded Wall Street analysts' expectations, but the second-quarter earnings per share and third-quarter revenue outlook fell short of expectations, causing its after-hours stock price to drop sharply by nearly 10%.

Key performance data:

In the fiscal quarter ending June 30, Netflix's net profit was $720 million, up 166% from $271 million in the same period last year; earnings per share were $1.59, far higher than $0.60 in the same period last year, but still lower than analysts' previous expectations. According to data provided by Yahoo Finance Channel, 38 analysts had previously expected Netflix's earnings per share to reach 1.81 US dollars in the second quarter.

Netflix's second-quarter revenue was US$6.148 billion, up 24.9% from US$4.923 billion in the same period last year, exceeding analysts' expectations. According to data provided by Yahoo Finance Channel, 35 analysts had previously expected Netflix's second-quarter revenue to reach 6.08 billion US dollars.

By region, Netflix's second-quarter streaming service revenue from the US and Canadian markets was US$2,840 billion, up from US$2,501 billion in the same period last year; streaming service revenue from the European, Middle Eastern and African markets was US$1,893 million, up from US$1,319 million in the same period last year; revenue from Latin America was US$785 million; up from US$677 million in the same period last year; and revenue from the Asia-Pacific region was US$569 million, up from US$349 million in the same period last year.

Netflix's second-quarter operating profit was $1,358 million, up from $706 million in the same period last year; operating profit was 22.1%, up from 14.3% in the same period last year. Netflix's second-quarter eBITDA (that is, earnings before interest, taxes, depreciation, and amortization) was $1,489 million, up from $836 million in the same period last year.

Costs and expenses:

Netflix's second-quarter revenue costs were US$3.644 billion, up from US$3.06 billion in the same period last year; marketing expenses were US$434 million, down from US$603 million in the same period last year; technology and development expenses were US$435 million, up from US$383 million in the same period last year; and general affairs and administrative expenses were US$277 million, up from US$225 million in the same period last year.

User data:

The total number of Netflix streaming service paid users worldwide reached 1929.5 million in the second quarter, an increase of 23.4% compared to 1515.6 million in the same period last year. Among them, the number of streaming service paid users in the US and Canada was 72.9 million, up from 66.5 million in the same period last year; the number of streaming service paid users in Europe, the Middle East, and Africa was 61.48 million, up from 44.23 million in the same period last year; the number of streaming service paid users in Latin America was 36.07 million, up from 27.89 million in the same period last year; and the number of streaming service paid users in the Asia-Pacific region was 22.49 million, up from 12.94 million in the same period last year.

Netflix added 1.09 million new streaming service subscribers worldwide in the second quarter, up from 2.7 million in the same period last year, and over 10 million for the second consecutive quarter. Among them, the number of new paid users in the US and Canada was 2.94 million, up from -130,000 in the same period last year; the number of new paid users in Europe, the Middle East and Africa was 2.75 million, up from 1.69 million in the same period last year; the number of new paid users in Latin America was 1.75 million, up from 340,000 in the same period last year; and the number of new paying users in the Asia-Pacific region was 2.66 million, up from 800,000 in the same period last year.

Other financial information:

NaifeiNet cash from business operations for the second quarter was $1,041 million, compared to $544 million in net cash used in business operations for the same period last year. Netflix's free cash flow for the second quarter was $899 million, compared to $594 million for the same period last year. As of the end of the second quarter of fiscal year 2020, the total amount of cash, cash equivalents, and restricted cash held by Netflix was approximately $7.180 billion.

Performance outlook:

Netflix expects the company's revenue for the third quarter of FY2020 to reach US$6.327 billion, up 20.6% from US$5.245 billion in the same period last year; operating profit will reach US$1,245 million, and operating profit margin will reach 19.7%; net profit will reach US$954 million, earnings per share will reach US$2.09; the net number of users who pay for global streaming services will reach 2.5 million, and the total number of users who pay for global streaming services will reach 195.45 million.

According to data provided by Yahoo Finance Channel, the average of 36 analysts expected Netflix's third-quarter earnings to reach 2 US dollars per share, and the average of 33 analysts expected Netflix's third-quarter revenue to reach 6.39 billion US dollars.

Changes in senior management:

Ted Sarandos (Ted Sarandos) has been appointed as Netflix's Co-CEO and has been elected to the company's board of directors.

Netflix said in a press release: “Salandos joined the company more than 20 years ago, and we are delighted to appoint him as co-CEO, along with Reed Hastings.”

Hastings said, “Ted has been my partner for decades. This change makes what was otherwise less formal official — Ted will co-lead Netflix with me.”

Stock price changes:

On the same day, the Netflix stock priceNASDAQThe securities market rose $4.13 in regular trading to close at $527.39, or 0.79%. In the after-hours trading that followed until 4:44 p.m. EST on Thursday (4:44 a.m. Beijing time on Friday), Netflix shares fell sharply by $52.61 to $474.78, or 9.98%. Over the past 52 weeks, Netflix's highest price was $575.37 and the lowest price was $252.28. (Tang Feng)