Netflix Implodes After Reporting Horrific Guidance; Notes It Repuchased Stock At $218 Avg Cost Basis

Tyler Durden's picture

One hopes that the European surprise on Wednesday will be more successful than this. In the meantime, the XIRR on Jim Cramer's recommendation to buy NFLX on Sept 26 at $135 through the current AH price of $87 is -99.6%.

Earnings summary shows EPS forecast peaking at $0.70 which the street had at $1.10. Explains the epic collapse in the stock after hours.

Some highlights from the letter:

  • We expect streaming net addition will be negative in October due to the cancellation wave referred to above
  • We used $39.6 million in Q3 to repurchase 182,000 shares at an average cost basis of $218.
  • After the repurchases we finished the quarter with $366 million in cash and equivalents
  • We expect to report a global consolidated net loss in Q1 2012 as well as to consumer cash as we launch the UK

And here is why we repeat our warning from last year, that Netflix' business model demands a follow on offering:

  • We expect our FCF to continue to lag net income for the next few
    quarters as our spending on content continues to increase both
    domestically and internationally
  • By pausing on further international expansion and halting buybacks, our current cash on hand is adequate to support the growth of the business. As we have done in the past, we will continue to evaluate the appropriate cash level for the business

Cramer buying at $135 on September 26, 2011

The IRR for anyone who listened to Cramer a month ago: -99.6%

In other news, sub $100  make that $87

Full earnings "investor letter"


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Long-John-Silver's picture

Where is RoboTimber?

Divided States of America's picture

Robo went to the post office to return his Netflix porno DVDs.

Pladizow's picture

Tilson's got to be kicking himself in the ass for originally getting out of the trade, even though I think he later put the short back on!

trav7777's picture

NFLX was buying the stock to support the options of management...this is .com all over again.  They wasted cash and profits to funnel to executives.  Heads of these incompetent asses need to roll

Herd Redirection Committee's picture

Check out the latest from the Capital Research Institue "On Behalf of the 99%":

"...the media for the most part is completely in the dark, at best, or complicit, at worst.

The point being, people don’t really know WHAT they want, in terms of reform.  Thats why the ‘Change’ gimmick worked so well for Obama.  Because people KNOW they want change, they just want someone to tell them what will be changed, and why that will be better.  Herman Cain’s 9-9-9 plan is the exact same.  People aren’t worried about the specifics, they just know they want change.   Well, I am here to help steer the herd a little, as it were.

What is needed is the banning of usury, an end to the Federal Reserve System, and a return to Sound Money, for starters."

AldousHuxley's picture

Herman Cain wants you to pay 9.99 for a slice of Diarrhea Pie.


Don't get stuck in an elevator after eating one of those like this guy...


Future of USA

captnKrunch's picture

hmmm.  Let me suggest that first we need to get REPRESENTATIVES in washington ... not shills.  I suggest the best way to do this is to criminalize bribing of politicians via campaign contributions by organizations THAT CAN'T VOTE.  The other kind of bribery is already illegal.  If you can't vote, you can't bribe!  This is not a violation of the first amendment because (1) organizations aren't people (they can't vote can they?) and (2) they can run any ads they want saying anything they want (without direction from a candidate).

Hephasteus's picture

Let's just be a simple fuck about it.

Netflix and hulu have one job. Destroy the old cable tv business model of television where shit was simply broadcast to dumb tvs and radios and replace it with a new business model where shit is broadcast to trackable mac addresses. Because you can't enforce rediculously high priced enterentainment without lots of jail and lawyer and data processing overhead. I mean seriously do you seriously think they can charge 100 120 bucks a month for cable and internet? Hell no they can't. Why do you think they switched to digital tv? To get more hi quality channel transmissions? NO because TV decoder boxes have a mac address and are "SMART".

The hollywood fucktard companies didn't start the cable companies and turn them into massive structure query language fucktard machines so they couldn't play god now did they?

They want to make more money on the new machinery than they made on the older simpler machinery and be more landlordish about it. Problem is they won't.  Hulu is CBS fox news and disney which is wierdly comcast. Netflix is microsoft and all the mysterious fuckers behind them. Blockbuster is dish network which is a bunch of creepy ass jewish cell phone companies. 

You are inside the biggest blackest box of monopolistic lying ass entertainment. It's a bit more complicated than executive profits. It's the power to make or break actors control their behaivor. Make them act out rediculous fucking farces of reality. Claw back payments with drugs. Because nobody will fucking protect you like an addict who gets drugs from you.

It's like that late show guy. The drew carey british guy. He's a fucking drug addict. He had several shows dedicated to making fun of gaddafi complete with fake audience laugh tracks and nothing behind it but celebrating jews.

All these tech companies are not tech companies. They are simply tech companies that are stitched to the entertianment and propaganda industries asshole. And they'll destroy their old companies to drive people to new "distribution" systems in a heart beat. If it means more power more control more ability to flavor the manipulation just so.

dark pools of soros's picture

I just love netflix for the animefix  - japanese still know to enjoy themselves..  maybe the stock will go down to $50 so I can buy back in where I sold before the run up  :)

Oh regional Indian's picture

Nice Heph. Like the way your mind works. Interesting in-sights.


prains's picture

NFLX is the US economy in short hand writing

homersimpson's picture

Actually, he tried to go to Vegas to convince the Pit Boss that he should be allowed to bet on a number AFTER the dice is thrown..

Sudden Debt's picture

Yes, you even get to lick it as many times like you want.

It's very popular so it seems.

UGrev's picture

The irony here is that porn is probably one of the only things that could save Netflix.. 

trav7777's picture

too much free porn available like everywhere else

UGrev's picture

while true, there are people that don't want to surf to search and wade through the virus ridden interwebs to find it. There are more people who don't want to bother with it and would rent it for a few bucks than have to waste time trying to find it. It's a convenience cost.. nothing more.. and people pay for convenience all the time. 

nyse's picture

Pretty doubtful one would get a virus from free porn, haha! Who is this guy? 

UGrev's picture

I wasn't referring to the free porn once you found it.. I was referring to acquiring during the search for it.. 

DeeDeeTwo's picture

You must be running Windows 98.


UGrev's picture

You would be surprised how many hundreds of thousands of people don't know how to navigate the net and end up with nasty shit on their systems. 


Hephasteus's picture

Those days are long gone. They can track you completely now. No need to fuck with your computer any more.

I mean sure it's not failsafe. I've been on the net where it throught It was someone else. It's a rush but it's also extremely difficult. The reason ad trackers and ad aware are gone is because you've got 6 to 12 ad bots attached to your ass every time you log in the internet. They get you from the second you enter the door and have you tagged till you log out.

Hugh G Rection's picture

works great on smart phones too!

Hulk's picture

links to support your case???

Agent P's picture

Not to mention the irony that Robo's popularity around here seemed to plummet when stopped including porn in his posts.

WTF_247's picture

Well if they wanted to do gay porn, they could always call it NetDix ....

RacerX's picture

How about Lesbian porn? NetLIX?

LeonardoFibonacci's picture

This is not funny, i just called Robo's mom and she said he just attempted to drown himself in the plastic kiddie pool in the backyard.  The fire department is on its way.  He will surely be placed on suicide watch.

UGrev's picture

Is anyone willing to be "on watch" ?

nyse's picture

What a pussy. Shoulda just drank a glass of Drano like his dad did.

oddjob's picture

Shoulda just drank a glass of Drano like his dad did.

Ask his mom which one of his thousand fathers did that.

sheeple2012's picture

His BUY BUY BUY at $295 went down the Cramerica memory hole a long time ago....

Grinder74's picture

#WeCantWait for Cramer to go down his own memory hole.

AldousHuxley's picture

you mean like this?


Jim Cramer: "Bear Stearns is Fine!" Tues, 3/11/08

NumberNone's picture

Was watching CNBC the other day and had volume down and closed caption on.  Every time Cramer's name was mentioned by someone on  air, CC typed 'Crimer'.  How prescient. 

YesWeKahn's picture

Not funny at all, Robo was enjoying today's rally.

Ruffcut's picture

Too bad the puts on this Bag O' Shit, were a little expensive.

Robo will be fine, He will get back on his mule only to fall off, again.

LooseLee's picture

Yea, where is that bull fucktard? Netflix was the highlight of his postings in June/July and before. So what happened Robo? Did the ZH 'smart money' catch you unaware? What say now?

Freddie's picture

LOL!  Did Cramer really pimp Netflix?  Too funny. What a ass he is.

redpill's picture

Someone call Robo's mom and have her check on him in the basement please.

Pladizow's picture

Auto-erotic asphixiation?

redpill's picture

More like Autobot fixation.  He likes Optimus Prime the best, it's just unfortunate the decals fall off in the bathtub.

Arkadaba's picture

Hey Robo,Robo , come out to play!

LFMayor's picture

Hung foo, just like Carradiene.  While listening to an old INXS cassette.

depression's picture

Robo is the best hindsight trader I have ever seen.

GeneMarchbanks's picture

Short to 0. Nuff said.