SAN FRANCISCO -- Netflix reported third-quarter profit that beat analysts' estimates, and signed up U.S. customers faster than projected as the video-streaming service passed HBO in paid domestic subscribers.
Profit totaled 52 cents a share, Los Gatos-based Netflix said Monday on its website, beating 47-cent average of 27 analysts' estimates. Including free trials, domestic subscribers rose to 31.1 million, compared with the 31 million average of eight estimates compiled by Bloomberg.
The results suggest Netflix's Web-based service has growth potential beyond that of a traditional cable-TV network. Chief Executive Officer Reed Hastings is offering a mix of original programs like "Orange Is the New Black" and unlimited viewing of movies and TV shows for $7.99 a month. He has begun talks to bring Netflix to cable-TV systems in the United States, after reaching initial deals in Sweden and Britain.
Netflix surged 10 percent to $392.05 in extended trading after the results. The stock rose 6.4 percent to an all-time high of $354.99 at the close in New York and has almost quadrupled this year, for the biggest gain in the Standard & Poor's 500 Index.
Third-quarter net income quadrupled to $32 million, from $7.68 million, or 13 cents a share, a year earlier.
Sales increased 22 percent to $1.11 billion from $905.1 million a year ago, beating
estimates of $1.1 billion.
Original programs such as "Orange Is the New Black" and the Emmy-winning "House of Cards" are a crucial component of the company's effort to attract and keep viewers. The company has also reached deals to get exclusive movies from Walt Disney Co. and DreamWorks Animation SKG Inc.
During the quarter, Netflix began streaming "Orange is the New Black" and the Ricky Gervais comedy "Derek." It also began service in the Netherlands, helping bring its international subscriber total to 9.19 million.
In the U.S., paid subscribers totaled 29.9 million,, Netflix said. That's an increase from 28.6 million as of June 30, and puts Netflix firmly in front of HBO, Time Warner Inc.'s premium cable-TV network, which has about 28.7 million, according to researcher SNL Kagan.