Netflix wows Wall Street with strong subscriber growth

Netflix (NFLX, Tech30) saw strong membership growth in the first quarter of 2015 with it totaling 62.3 million members on the service.

The streaming site reported 4.9 million new members were added in the first quarter of the year.

This number was up from the 4 million subscribers it added in the same quarter last year.

Investors seemingly loved what they saw from the report with the stock soaring as much as 13% in after hours trading. At these levels, the company's stock should open at all-time highs on Thursday.

The company also announced that it broke through 40 million members in the U.S.

"We think strong U.S. growth benefited from our ever-improving content," the company said in a letter to investors.

Netflix didn't exceed all expectations. The company came up short in its earnings per share with $0.38, which was well under its projection of $0.60. Netflix explained that the EPS numbers took a hit due to currency exchange losses because of the surging dollar, and without that would have been $0.77.

One of Netflix's chief competitors, HBO, got into the subscription video marketplace earlier this month with the $15 a month "HBO NOW." Yet, the company didn't seem too concerned with the cable network's presence.

"As we have said in the past, Netflix and HBO are not substitutes for one another given differing content," the company said in its letter to investors. "We think both will continue to be successful in the marketplace."

Netflix's earnings come at a time where the company is launching new shows and is also seeing a bit of resurgence in its original programming slate.

Last year, CBS chief research officer David Poltrack was critical of the company saying that the service hadn't had a hit since 2013.

Yet, in the past few months, the company has introduced new series like "Bloodline," "Unbreakable Kimmy Schmidt," and Netflix's first Marvel series, "Daredevil," all of which have amassed critical acclaim and positive reaction from viewers.

Away from the successful premieres of its new original shows, Netflix also inaugurated the third season of "House of Cards" in February.

The political thriller starring Kevin Spacey is one of the company's trademark programs, but some wondered if it would return for another season. Netflix put that doubt to rest in April when it confirmed that the drama would return for a fourth season in 2016.

"House of Cards" won't be the only Netflix original returning next year.

Early on Wednesday, the company announced that another of its beloved original series, "Orange Is the New Black," would also return for a fourth season in 2016.

Related: CNNMoney's Tech30

CNNMoney (New York) April 15, 2015: 6:40 PM ET

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Etsy crafts a $267 million IPO

Etsy is now the largest certified socially-responsible company, or B Corporation, to go public in the U.S. It will begin trading Thursday on the Nasdaq under the ticker symbol "ETSY." The online marketplace is a place for people to buy and sell crafts and other handmade and vintage items.

So far, investors don't seem overly worried that Etsy's focus on long-term sustainability will clash with Wall Street's focus on short-term profitability.

Etsy priced its initial public offering at $16 a share on Wednesday evening -- the high end of its expected range. The deal raised a total of $267 million. Based in Brooklyn, the company is now worth nearly $1.8 billion.

Can it scale? The biggest question facing Etsy is how the e-commerce company can ramp up in size while maintaining its identity as a place where customers can find unique goods that are not mass produced. Losing that niche identity could do real harm to Etsy's business, which has thrived thanks in part to its fiercely loyal base of buyers and sellers.

Investors need to assess "the confidence that this company can scale without going to the dark side of full commercialism," said Kathleen Smith, a principal at Renaissance Capital, which is a manager of IPO exchange-traded funds, or ETFs.

Related: Can a do-good company jive with Wall Street?

Competing interests? In its IPO prospectus, Etsy acknowledged a key risk facing potential investors is that the company's "focus on long-term sustainability may negatively influence our short-or medium-term financial performance."

In other words, Etsy may want to do things that won't please investors who mostly care about the stock price. For example, Etsy said it could invest in alternative forms of shipping that reduce the impact on the environment but are most expensive.

"We investors want sustainable results," said Smith.

Etsy's ability to manage these competing interests will be key.

"Public companies are held to a different standard, and Etsy needs to be prepared for public market scrutiny, regardless of how artisanal they are," said James Gellert, CEO of Rapid Ratings.

Related: Starbucks should join Etsy as a B Corporation

Crafting a profit would be a start: That scrutiny will eventually call for a path to profitability, something that's been missing from the online marketplace. Etsy has posted net losses in each of the past three years.

"Considering the company's lack of profitability and capital structure inefficiency, Etsy has a long way to go before they're a long-term sustainable business," said Gellert.

Related: GoDaddy races onto Wall Street with IPO

Is Etsy a bargain? However, its revenue has been on the rise amid the site's growing popularity. Sales jumped 56% last year to $195.6 million.

Smith said Etsy's IPO range doesn't look expensive, at least compared with the sales multiples placed on other fast-growing e-commerce companies that have commission models such as eBay (EBAY, Tech30), Alibaba (BABA, Tech30), GrubHub (GRUB) and Yelp (YELP).

"It's possible this (stock) could have a real cult following. They already have a cult following as a community," said Smith.

Etsy has already shown a willingness to do things differently than Wall Street is used to. It created a program that gives vendors and other mom-and-pop investors the chance to buy as much as $2,500 in stock before its public debut. Normally those early purchases are exclusive to rich investors.

"That's caused some angst among institutional investors," said Smith.

It probably won't be the last thing Etsy does that makes Wall Street nervous.

Related: Get the balloons ready for Party City's IPO

CNNMoney (New York) April 15, 2015: 6:48 PM ET

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GM shielded from ignition lawsuits by bankruptcy rule

The decision by Federal Bankruptcy Court Judge Robert Gerber upholds GM's so-called bankruptcy shield. GM acquired the shield as part of its bankruptcy reorganization when a new company was created in 2009, referred to in court as "New GM."

"Judge Gerber properly concluded that claims based on Old GM's conduct are barred," the automaker said in a statement.

The shield had been challenged both by some personal injury attorneys as well as lawyers suing on behalf of owners of the recalled cars to recover damages for the diminished value of the recalled cars.

The decision could prevent lawsuits that would have cost "New GM" billions of dollars.

"This ruling padlocks the courthouse doors," said Robert Hilliard, one of the attorneys suing GM. "Hundreds of victims and their families will go to bed tonight forever deprived of justice. GM, bathing in billions may now turn its back on the dead and injured, worry free."

The decision left the possibility for some suits to proceed if the plaintiffs can prove misdeeds by the company after the 2009 bankruptcy, "so long as those plaintiffs' claims do not in any way rely on any acts or conduct by old GM."

The old and new version of the tiny part that is at the center of the GM recall.

GM (GM) shares were up about 1% in after-hours trading following the decision.

Problems with millions of cars with faulty ignition switches, most of them built before the bankruptcy, have been tied to at least 84 deaths. It is not immediately clear how many of the accidents occurred after the bankruptcy. Accidents that occurred in the years following 2009 were not protected by the shield.

GM has admitted that its employees were wrong not to order a recall of the cars about a decade before the 2014 recall.

The decision will not stop GM from paying an estimated $400 million to victims and their family members. But GM set up a compensation fund voluntarily without waiving the legal protections it acquired as part of the bankruptcy process on pre-2009 accidents.

Related: Recall victim - GM shouldn't get a tax break from settlement

Related: Barra's recall apology not enough, families say

Related: GM settles second suit with recall whistle-blower

CNNMoney (New York) April 15, 2015: 7:03 PM ET

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Will Hillary Clinton support a $15 minimum wage?

If Hillary Clinton wants to woo the left, she'll likely have to support $12 to $15 an hour.

President Obama made waves in his 2013 State of the Union address when he unexpectedly announced he wanted to raise the federal minimum wage to $9 an hour, from the current $7.25. A year later, he called for $10.10 an hour.

But advocates and lawmakers on the local level have moved well beyond that $10 rate. Seattle and San Francisco have raised their minimum wage to $15, while Massachusetts' rate is now $11. Lawmakers in other states, including Oregon and California, also want to boost the floor on wages.

Related: Jack Lew: Higher minimum wage = stronger economy

Senator Patricia Murray of Washington and some of her Democratic colleagues want to see the minimum wage raised to $12 by 2020.

"The days of $9 to $10 an hour are over, for sure," said Tsedeye Gebreselassie, senior staff attorney at the National Employment Law Project, one of the groups involved in the 'Fight for $15' movement to raise the wages of fast-food workers and others.

The project believes presidential candidates that are serious about rebuilding the middle class need to support raising the minimum wage to at least $12 an hour and to commit to additional hikes in the future. It recently published a report showing that 42% of American workers make less than $15 an hour.

"Low-wage occupations in sectors such as retail, home care and restaurants are among the fastest-growing in the country," said Christine Owens, the group's executive director. "If we want an economy that is balanced and shares prosperity fairly, we must raise wages in these sectors so that they can serve as the cornerstones to rebuilding our nation's disappearing middle class."

Public pressure to raise wages has already pushed several companies to hike pay. Walmart will boost its minimum wage to $10 by next Feb. 1, while starting pay at 1,500 McDonald's-owned restaurants will increase to at least $1 an hour more than the minimum wage set by local laws, as of July 1.

Related: McDonald's gives workers a raise, but is criticized for not going far enough

Clinton has long supported raising the minimum wage. As a senator, she introduced legislation in 2007 to increase the rate to $9.50, and as first lady, she advocated for the successful 1996 push to boost it to $5.15, according to Correct the Record, a pro-Clinton web site.

More recently, Clinton has voiced support for raising the rate, but hasn't put a number on it. Her spokesman did not return emails seeking comment.

A recent report by the Center for American Progress, run by a former top Clinton policy adviser, may give some insight into her thinking. The report on building prosperity recommended setting the wage to at least $10.10 an hour, which would prevent full-time workers from living in poverty.

But supporting a minimum wage increase can mean walking a tightrope between workers and businesses, which Clinton also needs to court. Many business owners have said they can't afford a rate hike and any boost will cost jobs.

A 2014 Congressional Budget Office report shows the conflict between the two sides. Raising the minimum wage to $10.10 is projected to lift 900,000 workers out of poverty, but it would also mean the loss of 500,000 jobs.

Related: Low-wage workers plan major strike

CNNMoney (New York) April 14, 2015: 6:57 PM ET

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U.S. fines Corinthian Colleges $30 million

The department found that the Corinthian-owned Heald College, based in San Francisco, misrepresented employment numbers to prospective students and the government.

"Instead of providing clear and accurate information to help students choose which college to attend, Corinthian violated students' and taxpayers' trust," said DOE Under Secretary Ted Mitchell in a statement.

An investigation found that Heald College paid temp agencies to hire its graduates to work on its own campuses for as little time as two days so that it could count those students as employed. Heald failed to disclose that its placement rates counted those students whose employment began prior to graduation, and in some cases prior to even enrolling at the school, according to the Department of Education.

Related: Why 100 Corinthian students are refusing to pay off their debt

It also says Heald College sometimes inaccurately reported on graduates who found a job related to their field of study. In one example, it counted a 2011 accounting graduate who was working at a Taco Bell.

A Corinthian spokesman called the allegations "highly questionable" and "unsubstantiated."

"Heald has a well-documented track record of providing quality education and significant value to its students for more than 150 years—and should be allowed to continue to do so," he said.

Related: University of Phoenix has lost half its students

Heald College was acquired by Corinthian in 2010 and currently has 9,000 students and employs 1,000 faculty and staff.

Corinthian's network of for-profit schools once included 100 campuses across the country, but the government has forced it to close or sell off its locations over concerns about its high-interest loans and misleading information. A majority of its schools have been sold to the nonprofit Zenith Education Group, but that sale didn't include the Heald campus.

Corinthian is in hot water for allegedly preying on low-income people with high-interest loans and is facing lawsuits brought by the Consumer Financial Protection Bureau and attorneys general in California, Massachusetts and Wisconsin.

In February, the government struck a deal with the company acquiring some of Corinthian's campuses, forcing it to wipe out $480 million in debt. Ongoing lawsuits could increase that amount.

More than 100 former students are refusing to pay off loans they used in order to attend the network of colleges owned by Corinthian, and nine state attorneys general have asked the government to cancel their debt.

The fine further threatens Heald's future by imposing an additional financial burden on prospective buyers, a Corinthian spokesman said.

It has 14 days to respond to the Department of Education's decision. At that time, the agency could force the school to stop enrolling any more students and prepare to help current students either finish their degree or transfer elsewhere.

Once a cash cow industry, for-profit education companies have struggled to overcome criticism of the quality of its education and the costs. The University of Phoenix has lost more than half of its students in the past five years.

CNNMoney (New York) April 14, 2015: 7:11 PM ET

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How Grumpy Cat makes her millions

Grumpy Cat is part of an elite group of furry animals around the globe who have shot to Internet fame in recent years. These fuzzy creatures sign book and movie deals, do photo shoots, and act as "spokesanimals" for ad campaigns -- netting piles of cash for their owners.

Experts say the phenomenon is made possible by the rise of social media, which is changing how we interact with lovably fuzzy creatures.

Social media "adds a personal connection, so if you're interested in a character like Grumpy Cat, then either people will send you more anecdotes or videos, or you can go and seek it out," said Karen North, a social media expert and professor at the University of Southern California.

It's "a way of getting entertainment in the hands of audience members who become evangelists of the content, and spread it wider than the originator ever dreamed," North said.

Related: China spends $1.5 billion pampering pets

Owners can monetize their pets via multiple sources -- product endorsements, licensing agreements and even original merchandise.

It all starts with building a massive following online. Viral pet owners can also consider registering a trademark, whether it's a name or a distinctive feature, to help protect against any copycats, said Marty Brochstein of the International Licensing Industry Merchandisers' Association.

"Is there some specific recognizable aspect to it that makes it other than just a cat?" Brochstein said. "In terms of bringing in business, it's just like any other celebrity -- you have an agent who is either fielding offers or ferreting out business opportunities."

Grumpy Cat, for example, has an easily identifiable sourpuss face -- the product of an underbite and feline dwarfism, a genetic condition. The look has entranced millions of web followers, leading to Grumpy Cat designer apparel, a New York Times best-selling book, a movie and a coffee brand -- Grumppuccino.

The licensing and merchandising deals have translated to buckets of cash for Grumpy Cat's owner, Tabatha Bundesen.

"Grumpy Cat is making millions!," said North. "It's shocking!" Bundesen didn't respond to requests for comment.

And yes, Grumpy Cat has a manager, as does Hong Kong's own celebrity cat, Brother Cream, a chubby white and tan feline who lives in a local convenience store. Brother Cream has thousands of social media followers, and fans who visit from around the globe want to know about everything from his bowel movements to public appearance schedule, owner Ko Chee-Shing said.

Like Grumpy Cat, Brother Cream has done commercials or promotions for major brands such as L'Occitane, Shu Uemura, Microsoft (MSFT, Tech30) Xbox and Nikon (NINOY). Ads featuring his image are plastered across the city's public buses, airport baggage carts and subway stations. Groupies can buy handbags, stickers, books and folders with his image.

Related: Big dogs suffer as Hong Kong status symbols

Brother Cream has been paid hundreds of thousands of dollars for his work, padding out a stellar five-page resume. So much money has flooded in that Ko started a non-profit to dole funds out for charitable purposes, including animal rescue and food aid programs.

His fame has even helped bring more customers to Ko's shop, one of the few remaining independent convenience stores in a market dominated by international chains 7-Eleven and Circle K.

Brother Cream, who initially did nuzzle a hello to this reporter, later declined to answer any questions in favor of a nap -- in true celebrity fashion.

Related: Doggie dates have come to Tinder!

CNNMoney (Hong Kong) April 14, 2015: 8:54 PM ET

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Will.i.am is selling sheets made from old Coke bottles

Will.i.am is partnering with Coke and W Hotels on a line of bed sheets partially made from old plastic bottles.

It's not that he's fallen on hard times in the music biz, it's more that he's into recycling. So the Black Eyed Peas frontman has partnered with Coke (KO) and W Hotels on a line of bedding made with at least 30% recycled plastic.

The sheets will soon be on all W hotel beds worldwide. They don't look or feel any different than the hotel's current sheets -- the plastic is used to make polyester and simply replaces the virgin polyester currently used in the blended fabric. Each king-sized sheet will contain about 31 plastic bottles.

For W, the move was about being more eco-friendly as well as saving money. The new sheets are more durable and can be washed up to 200 times before wearing out (compared to about 100 washes now).

Related: L.A. to control its street lights with a single laptop

The sheets will also be available for purchase at the W's store, though they aren't cheap -- a set starts at $207.

They'll carry both the W and Ekocycle brand. Ekocycle is a broader partnership between Will.i.am and Coke to use recycled content in more products.

Will.i.am said he got the idea for Ekocycle back in 2008 after attending conferences on corporate social responsibility and hearing about how firms want to cut waste.

"A lot of times the companies say what they want to do, but not how they're going to do it," he said. "Or they do it, but they don't tell anyone."

Related: The activist nun reforming for-profit prisons

So he pitched Coke with an idea to market recycled plastic to other firms that wanted to green their products. Coke bit, and Ekocycle launched in 2012. It now has its name on over 150 products including shoes, luggage, bicycles and chairs. Companies that want to use the Ekocycle brand pay a royalty, which is shared between Coke and Will.i.am.

"Our resources are not forever," Will.i.am said. "Sustainability is going to be something we're all talking about."

If all this sounds like a bunch of people making money while burnishing their green credentials, it is. But it's also important for those with branding experience to create a market for recycled material. This is especially true now that the cost of oil -- which is virgin plastic's main ingredient -- is so low. Cheap virgin plastic puts recycled plastic at a disadvantage.

"Recycling is more than just putting stuff in the right bin," said Darby Hoover, a resource specialist at the Natural Resources Defense Council. "And it's good that Coke is taking responsibility for its bottles."

CNNMoney (New York) April 13, 2015: 6:25 PM ET

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Hillary channels Elizabeth Warren in campaign bid

In her video campaign announcement Sunday, Hillary Clinton unveiled what's expected to be the central theme of her presidential bid: Serving as a champion for "Everyday Americans."

"Americans have fought their way back from tough economic times, but the deck is still stacked in favor of those at the top," she said in the short video. "Everyday Americans need a champion and I want to be that champion. So you can do more than just get by. You can get ahead and stay ahead."

Long considered a centrist, Clinton sounded strikingly similar to Warren, the outspoken darling of the left wing, which has been pushing the Massachusetts senator to run for the 2016 nomination. (So far, she has declined.) Warren's main talking point: Give every American a fighting chance.

"America's middle class is under attack. It's in trouble because the game is deliberately rigged," Warren wrote in her memoir, A Fighting Chance. "I am determined -- fiercely determined -- to do everything I can to help us once again be the America that creates opportunities for anyone who works hard and plays by the rules."

Related: Elizabeth Warren: 8 ways to restore the middle class

Warren's proposals to boost middle class prosperity include: Raising the minimum wage, supporting bargaining rights for workers, ensuring workers get overtime pay and creating good paying jobs through investments in roads, bridges, power grids, education and research, among other things.

In an election where every candidate is focused on the middle class, Clinton may have to shift left to appeal to the Democratic base. She and her advisers have been speaking to income inequality and economic mobility gurus, including Joseph Stiglitz of Columbia University and Raj Chetty of Harvard, according to media reports.

Stiglitz, a Nobel-prize winning economist, has argued that income inequality has exploded over the past 30 years. The widening gap endangers economic growth and makes it harder for people to achieve the American Dream.

Related: Stiglitz on how to fix the income gap

Chetty, on the other hand, focuses on economic mobility. His work has found that residents in communities with higher rates of segregation and income inequality, as well as fewer two-parent families, are less likely to climb the economic ladder.

Clinton's new top talking point is increasing opportunity for all Americans. She reiterated this in a new epilogue to the paperback versions of her book, Hard Choices, excerpted on Huffington Post on Friday. In it, she noted the advantages that her first grandchild, Charlotte, will have.

"Too few of the children born in the United States and around the world today will grow up with the same opportunities as Charlotte," she wrote. "I'm more convinced than ever that our future in the 21st century depends on our ability to ensure that a child born in the hills of Appalachia or the Mississippi Delta or the Rio Grande Valley grows up with the same shot at success that Charlotte will."

But some diehard liberal Democrats, including Warren, want to hear more on how Clinton plans to reduce inequality. So far, they say Clinton's message is long on rhetoric and short on specific policies.

A Clinton spokesman did not respond to a request for comment.

Related: NYC's Bill de Blasio not ready to endorse Hillary Clinton yet

New York City Mayor Bill de Blasio, who managed Clinton's Senate campaign in 2000, made waves when he said Sunday that he is holding off on endorsing Clinton until he learns more about her vision.

Warren, meanwhile, is also waiting for more details.

Asked in February by the Reverend Al Sharpton on MSNBC whether Clinton would be a "progressive warrior," Warren said "that's what we've got to see."

"I want to hear what she wants to run on and what she says she wants to do," Warren said.

Related: Republican? Or Elizabeth Warren? Who said it?

CNNMoney (New York) April 13, 2015: 6:18 PM ET

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High-skilled visa applications hit record high

These locations saw the most H-1B visa recipients in 2013, the only year for which data is currently available.

But it's getting tougher to "win" a work visa each year.

This year, 233,000 foreigners applied for the H-1B, the most common visa for high-skilled foreign workers. That's up significantly from 2014 (172,500 applications) and nearly double the applicants from two years ago (124,000).

"I'm not surprised by how high the number is," said immigration lawyer Tahmina Watson of Watson Immigration Law. "The world has changed and the law has not kept up with the world."

The U.S. Citizenship and Immigration Services will grant just 85,000 H-1B visas (20,000 of which are reserved for master's degree holders), which it selected on Monday via a lottery process. The unlucky applicants will get the $325 filing fee back.

Watson says the number of applicants is proof that Congress needs to act.

Proposed bills like I-Squared Act would lift the quota to 195,000 visas annually. There is also a proposed bill for a Startup Visa. If passed, this would transfer foreign entrepreneurs currently in the H-1B pool into a separate category.

In the meantime, states like Massachusetts and Colorado have introduced programs to help applicants get around the H-1B cap.

"Businesses really need to fill positions," said Watson, "... and people will not be able to get their dream jobs."

Related: These cities have the most high-skilled foreigners

Related: The next Google is one visa away from leaving the U.S.

CNNMoney (New York) April 13, 2015: 6:28 PM ET

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Rand Paul launches attack website on Hillary Clinton

The top of the site has a photo of Paul with his quote: "Hillary Clinton's attacks on liberty and the constitution make her unfit to serve as President of the United States."

Paul tweeted a link to the site Sunday morning, and his campaign issued a press release that he will launch the first advertisement against Clinton.

A YouTube video autoplays with an attack ad: "Hillary Clinton represents the worst of the Washington machine. The arrogance of power, corruption and coverup, conflicts of interest and failed leadership with tragic consequences."

The site also has a few dozen shareable images with the text, "Liberty Not Hillary," including Twitter (TWTR, Tech30) and Facebook (FB, Tech30) cover photos and profile images.

LibertyNotHIllary.com, which redirects to a special page on randpaul.com, was registered to Harris Media LLC. The company is a political PR firm that has done work for prominent Republican candidates.

Related: 'Hillary' websites going for up to $295K

Related: Rand Paul gets scolded by Fox News hosts

CNNMoney (New York) April 12, 2015: 3:14 PM ET

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