Netflix soars above $600 mark on reports it is in early talks to bring content to China

MarketsAssociated Press

Netflix crossed the $600 mark for the first time on Friday, following a report that the Internet video service is in early talks to bring its content to China.

Netflix is said to be in discussions with Chinese online broadcasting companies BesTV News Media Co. and Wasu Media Holding Co., according to The Wall Street Journal.

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Scott Devitt of Stifel Nicolaus said in a client note that expanding into China "would be a notable increase in its global operations." With more than 400 million households China could add to Netflix's subscriber base, but the company still must contend with some issues that could pose challenges to market entry, such as censorship, he explained.

Netflix has said it plans to be almost worldwide by 2016's end. It declined to comment specifically on China.

Netflix Inc. has been on a roll, gaining 4.9 million subscribers in the first three months of the year. That's more than any other quarter since the video streaming service's debut eight years ago. About 2.3 million of the new customers were in the U.S., where Netflix's subscriber count surpassed 40 million for the first time.

The company has continued to ride the success of original programs such as "House of Cards" and "Orange Is the New Black." It's also added more series, including "The Unbreakable Kimmy Schmidt" and "Bloodline."

Original programming is becoming increasingly important for Netflix as it faces more competition from other services, including an Internet-only option that pay-TV channel HBO recently started selling.

Shares of Netflix jumped $19.15, or 3.3 percent, to $606 in morning trading.

The stock price has soared more than 70 percent for the year to date. But the price may not stay that high much longer because Netflix is getting ready to split its stock for the first time since 2004. A split lowers the trading price of a stock by issuing more shares. Netflix is hoping the split will drum up even more interest in its stock by making it more affordable to a wider pool of investors.