Netflix (NASDAQ:NFLX) Subscriber Growth Questioned by Needham

Needham & Company aren't confident Netflix (NASDAQ:NFLX) will be able to grow their subscriber base at levels the market is looking for.

Needham said, "In a recent post on the Internet, Reed Hastings, Netflix’s CEO, noted that the company managed to its operating margin line because that was the one metric that management could control. If we didn’t know it before, we know it now. A rising operating margin will not be a key driver of Netflix’s valuation. The company’s valuation instead will depend almost solely on its ability to grow its installed base of subscribers, which, in turn, will importantly depend on its ability to acquire new, compelling streaming content."

Needham maintains a "Hold" on Netflix, which was trading at $179.79, gaining $1.38, or 0.77 percent, as of 1:00 PM EST.