Netflix (NASDAQ:NFLX) traded 7% higher on Wednesday morning, after posting earnings that beat Wall Street expectations.
The media services company reported earnings per share of $0.89 and total revenue of $4 billion, compared to analyst estimates of $0.68 and $4 billion.
For the closely watched metric of subscriber growth, Netflix added over 1 million domestic subscribers and nearly 6 million internationally, both of which handily beat consensus estimates.
While CEO Reed Hastings forecast continued strong growth, he also pointed to increased entry into the online entertainment space, “There are so many competitors. Disney is going to enter, AT&T (NYSE:T) is going to expand HBO, and YouTube is just on fire.”
With regard to market cycles for NFLX, it appears that the stock is cresting its current cycle, perhaps heading towards a declining phase. Netflix has avoided a cycle breakdown for the time being, but this may be the best it can do for a while.Our expectation is for a test by December of its recent lows near $320.
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