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For Netflix, better-than-expected isn't good enough

With competition heating up in the streaming-video race, expectations for Netflix are higher than ever. On Monday, its first-quarter earnings met many of those expectations, but not all.

Netflix (NFLX) beat expectations on earnings per share (EPS), and beat expectations for new subscriber adds, in both the U.S. and abroad. But it missed expectations on revenue, and its stock plummeted 13% in after-hours trading, a sign that these mostly-extremely-good results still aren't good enough.

Earnings per share came in at 6 cents, vs. analyst predictions of 3 cents. That's higher than at this time one year ago, when it reported 5 cents per share. On revenue, analysts predicted $1.97 billion in revenue, which would have represented a 24% jump over the first quarter of last year—a tall order. Netflix fell short, but only barely, reporting $1.96 billion in revenue.

New subscriber adds is arguably the biggest story here: Facing expectations of 1.82 million net new subscribers in the U.S., it smashed that, adding 2.23 million. On...