Netflix stock posted its biggest one-day gain since the video subscription service went public more than a decade ago.
The stock climbed $43.60, or 42 percent, to $146.86 Thursday as investors celebrated a fourth-quarter earnings report that Netflix Inc. released late Wednesday. Earlier in the session, the shares hit a new 52-week high of $149.17.
The results were highlighted by an influx of 2 million more U.S. subscribers to Netflix's Internet video service and an unexpected profit during the final three months of the year.
Netflix ended December with 27.1 million U.S. subscribers to its service that streams movies and TV shows over high-speed Internet connections. The company, based in Los Gatos, Calif., is aiming to reach 90 million subscribers.
Wedbush Securities analyst Michael Pachter said "impressive subscriber growth and cost control" drove the stronger-than-expected quarter. But he cautioned that long-term challenges remain, and kept an "Underperform" rating on the stock.
"We expect higher costs to result in erosion of the quality and quantity of Netflix's content library over time, resulting in higher churn (subscriber turnover), and we expect domestic subscriber growth to slow or stall completely in the next few years," he said in a note to investors. "We expect slowing growth to be evident later in 2013, with fewer net domestic subscribers added year-over-year."
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