Netflix says it’s a year ahead of schedule on subscriber goals

Netflix Inc. expects to reach 5 million subscribers next year, a year ahead of schedule when the goal was announced in 2002, Reed Hastings, CEO and co-founder, told stock analysts this week. Hastings also said that Netflix has set a new goal of reaching 20 million subscribers within five to seven years.

Barry McCarthy, CFO, said the company expects fiscal year 2006 pre-tax GAAP net income of $50 million and is targeting 50 percent annual growth in pre-tax GAAP net income over the next several years.

"Our outlook for the future reflects the continuing rapid subscriber growth and the increasing impact of the cost advantages and other financial benefits that flow from our market leadership,” Hastings said.

The company also reaffirmed its expectations 3.35 million to 3.5 million subscribers by the end of the third quarter, with revenue of $172.5 million to $176.5 million and net income of $4.5 million to $8 million. IN Q4, Netflix expects the subscriber base to grow to 3.85 million to 4.05 million, with revenue of $187 million to $193 million and net income of $1 million to $6 million.