free cash flow

2 million more streaming subscribers worldwide, $8 million net income

Source: http://www.engadget.com/2012/10/23/netflix-announces-q3-2012-earnings-two-million-more-subscribers/

Netflix saw a return to profitability and more than half a million new US subscribers in the second quarter of this year, and it’s now announced that it’s added a full two million more streaming members worldwide for the third quarter. That brings the company’s global base of streaming subscribers to 29 million, 25.1 million of which are in the US. It’s also announced another bump in profits to $8 million in net income, with global revenue of $905 million. It’s unsurprisingly a different story when it comes to DVD subscriptions in the US, however, with the company reporting a drop from 9.24 million total subscribers in Q2 to 8.61 million in Q3.

In terms of usage, Netflix says that its streaming members have now consumed over three billion hours of content, and that TV shows now account for about two thirds of that viewing activity. The company has also reiterated its commitment to original programming in its letter to shareholders, although it notes that commitment comes with some front-loaded expenses that will result in negative free cash flow for the next “several quarters” beginning with Q4. The company further adds that it believes “investment in originals is wise, and we will evaluate the performance of the slate next year to determine at what level we should fund additional original.” You can find the full letter and all the numbers at the source link below.

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Netflix Q3 2012 earnings: 2 million more streaming subscribers worldwide, $8 million net income originally appeared on Engadget on Tue, 23 Oct 2! 012 16:1 0:00 EDT. Please see our terms for use of feeds.

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Tuesday, October 23rd, 2012 news No Comments

This Chart Is Driving Apple Bulls Crazy (AAPL)

Source: http://www.businessinsider.com/chart-of-the-day-apple-pe-2011-12

Apple’s price to earnings ratio is at a relatively paltry 14 right now, and it’s driving Apple bulls crazy.

The chart below, which shows Apple’s shrinking PE, from Apple analyst Andy Zaky has been passed around for the last week. (At the time Apple’s PE was 13.3.)

What’s wrong with this chart?

Zaky explains: “Now even though Apple’s growth has far and outpaced the growth of Oracle (16.35 P/E), Amazon (96.15 P/E), Google (19.19 P/E), Cisco (15.11), Qualcomm Inc. (20.62), Amgen, Inc (13.53), Comcast (15.11 P/E), IBM (13.95 P/E), Chevron (13.50), Johnson & Johnson (14.94 P/E), Procter & Gamble (15.49 P/E), and AT&T (13.91 P/E), the stock trades at a far lower valuation relative to these top holdings on the NASDAQ-100 and S&P 500. Some of these companies have actually contracted in 2011. Yet, the market values the earnings out of these companies on the order of 4-5 times more in some cases than they value the earnings out of Apple.”

Of course, there’s more than one way to value a stock. If you value it based on trailing free cash flow, it’s arguably priced fairly, says our Henry Blodget.

chart of the day, apple quarterly p/e ratio compression, dec. 7 2011

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Wednesday, December 7th, 2011 news No Comments

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