Netflix subscriptions jump in third quarter

Netflix adds nearly 2 million subscribers during quarter as it continues to morph from DVD rental company to "streaming company that also offers DVD-by-mail," CEO Reed Hasting says.

Netflix added nearly 2 million subscribers last quarter as it continues to morph from a DVD rental company to "a streaming company that also offers DVD-by-mail," CEO Reed Hasting said.

What that translates to is third-quarter net income of $38 million, a 26 percent jump from the year-ago quarter, or 70 cents per share, up 35 percent from last year. Revenue was $553.2 million, a 31 percent increase over the year-ago quarter. Wall Street had been expecting Netflix to report earnings of 71 cents per share on sales of $549.7 million.

Gross margin was 37.7 percent, up from 34.9 percent a year ago. Shares of Netflix were on the rise in after-hours trading, after closing up slightly at $153.13 in regular trading.

Read more of "Netflix earnings: subscriptions jump as it transitions to streaming company at ZDNet's Between the Lines.

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