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[Mckenzie Witting]

Jon Silver does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

This is good news for Netflix. Over the past 18 months the company had been in dire straits, during which time it received a lot of press for its bold international expansion as well as its financial difficulties. Some observers postulate that it could become the next HBO, while others doubt that it will even survive the next five years.

Netflix built its brand with a compelling proposition as a virtual video store, where customers had 24/7 access to order DVDs online and rentals were shipped to subscribers via the US postal service with a postage-paid return envelop and no late fees, for a monthly subscription of $7.99. Netflix won customers away from the major video chains at the top end of the mass market; Redbox DVD kiosks focused on attracting cost-conscious customers; bricks-and-mortar behemoths like Blockbuster slid into oblivion.

Netflix had consistently met its financial targets and its share price rocketed to peak at $291 after it announced plans to expand into 43 Latin American countries following its previously successful international expansion into Canada.

Then it made an almost catastrophic mistake when it attempted to drive subscribers towards a faster transition away from physical DVDs to streaming. Netflix announced that it was splitting the two services, rebranding the DVD-only rental business as Qwikster with a monthly sub of $7.99 for DVD rentals only, and hiking the monthly subscription price more than 60% to $15.98 if customers wanted to have both DVD rentals plus streaming. Or, for $7.99, customers could continue to subscribe to the streaming-only Netflix Instant service.

Netflix quickly backtracked, abandoning the price increase, dumping new DVD rental service Qwikster and apologizing to customers. But the damage was done; a PR disaster ensued. The brand suffered badly and so did earnings.

Following the angry customer backlash triggered by a hike in fees, Netflix has little choice currently than to stick to the $7.99 price-point. Management have taken a price hike off the table in the medium term. It is significant too that Hulu initially launched at $9.99, but was forced to reduce to $7.99 after it failed to gain any traction.

Netflix is the leading premium content streaming service in the American markets, way ahead of its domestic rivals. It currently also has the largest global footprint as Amazon operates only in the US and Europe (LoveFilm) and Hulu is only in US and Japan. No other direct competitor has truly global reach yet and a factor preventing truly global reach are territorial licensing restrictions that remain part of legacy contracts for existing release windows, but they impact Netflix, Hulu et al equally.

In order to attract new subscribers and to reduce churn, Netflix must either pay premium prices for an exclusive window following theatrical release, as it has done with Disney in a deal that from 2013 provides Netflix with a range of Disney classics. From 2016, in a second stage deal, Netflix will have an exclusive window before pay TV for Disney, Marvel, Pixar and LucasFilm movies.

In the fourth quarter of 2012, Netflix added 2.05 million subscribers in the US market, one year after the Qwikster debacle. With 25.5 million subscribers, if Netflix were a cable company, it would rank second behind HBO (28-29 million subscribers) and considerably ahead of Showtime (21.3 million) and the rest of the pack.

If the programming strategies of Netflix, Hulu, Amazon et al succeed, we may see the emergence of the first serious competitors to challenge industry incumbents. We already know that the future of home video is online, as the DVD and BluRay become obsolete. Online television services with potentially global reach could prove a serious threat to pay TV opereators and major networks in the looming battle for eyeballs and audience engagement online.

The stock jumped 43 percent to $145.80 at 9:49 a.m. New York time, the highest intraday price since September 2011. Netflix said yesterday it signed 2.05 million new U.S. Internet subscribers in the quarter, bringing total domestic online customers to 27.2 million. The gain led to a net income of 13 cents a share, while analysts predicted a loss.

In October, Netflix said it could add as many as 2 million domestic online customers. The company finished the year with 8.22 million in the U.S. who get DVDs by mail and 33.3 million streaming subscribers worldwide.

Those included more than 6 million international online customers, a gain of 1.8 million from three months earlier. The increase helped Netflix keep its overseas loss to $105 million, less than the $113 million midpoint of its forecast.

Despite some calls by investors, Netflix has no immediate plans to raise its $7.99 monthly subscription fee, Hastings said on a conference call. The company could take advantage of low interest rates to raise a substantial amount of capital to pay for additional exclusive content, he said.

Netflix accounts for about a third of prime-time Web streaming, according to Sandvine Inc., a Waterloo, Ontario-based network services and research company. More than half of consumers ages 18 to 24 years old who have a TV connected to the Internet watch Netflix, according to research from NPD Group, a Port Washington, New York-based market tracker.

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The investment community will be paying close attention to the earnings performance of Fortinet in its upcoming release. The company is slated to reveal its earnings on February 6, 2024. The company's earnings per share (EPS) are projected to be $0.43, reflecting a 2.27% decrease from the same quarter last year. At the same time, our most recent consensus estimate is projecting a revenue of $1.41 billion, reflecting a 9.77% rise from the equivalent quarter last year.

Investors should also note any recent changes to analyst estimates for Fortinet. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Investors should also note that FTNT has a PEG ratio of 2.05 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The average PEG ratio for the Internet - Software industry stood at 1.72 at the close of the market yesterday.

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