Netflix, Inc. Earnings: What Subscriber Growth Slowdown?

For the past few months, Netflix (NASDAQ: NFLX) has been a battleground stock. Bulls have highlighted the huge year-over-year earnings growth that Netflix posted in Q1. Meanwhile, bears have noted that subscriber growth slowed significantly in the first quarter relative to the prior-year period -- and that Netflix stock trades for more than 100 times earnings.

In the second quarter, Netflix chipped away at the bear thesis by posting stellar subscriber growth in what is usually a seasonally weak quarter. Furthermore, operating income continued to rise on a year-over-year basis. Netflix's growth engine is still turning quickly.

Last quarter, revenue and operating income came in slightly ahead of the guidance that Netflix had provided in April. Contribution profits for the domestic and international segments were also modestly better than expectations -- but up significantly from Q2 2016. However, subscriber growth is where Netflix really excelled last quarter.

Source: Fool.com