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Netflix (NFLX) Down Big on Subscriber Miss; Plus IBM, EBAY

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Netflix (NFLX - Free Report) has hit the skids in Wednesday's after-market, down 12% following a disappointing Q2 earnings report. Actually, earnings of 60 cents per share were 4 cents ahead of estimates while sales of $4.92 billion was only marginally lower than expected. But it was a big deficit in subscriber growth -- 2.7 million in the quarter, versus 5 million expected and 5.5 million in the year-ago quarter -- which has taken the stock down double digits.

The company tried to focus on revenue growth of 26% in the quarter, as well as Q3 subscriber expectations of 7 million, but as of now this subscriber slowdown is weighing heavily on the shares, especially at a valuation around 130x earnings. Both International and U.S. subscriber growth fell in Q2. Shares have buoyed back to around -11% in late trading. For more on NFLX's earnings, click here.

IBM Corp. (IBM - Free Report) keeps its 5-year streak of earnings beats alive after Wednesday's close, posting $3.17 per share versus $3.06 expected. Revenues of $19.16 billion slightly eclipsed the $19.11 billion in the Zacks consensus. Gross margins came in stronger than expected at 47.4%, partly on stronger cloud business. Global Tech Services brought in $6.8 billion for the quarter.

Full-year earnings guidance is in-line with expectations at $13.90 per share, with free cash flow estimated at $12 billion. Shares of IBM are up roughly 3% in the late session.

eBay (EBAY - Free Report) put up typically solid numbers in its Q2 report: 68 cents per share in the quarter outpaced the 62 cents expected and 53 cents from the year-ago quarter. Revenues of $2.69 billion were up solid single-digits year over year and above the $2.67 billion in the Zacks consensus. Guidance for full-year earnings and sales remain roughly in-line. EBAY has not missed an earnings estimate since at least prior to when Zacks realigned stock-based compensation expenditures, dating back to mid-2015.

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