Yesterday Netflix (NASDAQ: NFLX) reported its first quarter 2016 results, boasting big numbers year-over-year and since the fourth quarter of 2015. Prior to the announcement, however, Netflix stock dropped in anticipation of a $2 price increase that could affect as many as 17 million members starting in May, said USA Today. Netflix stock closed at $108.40 and dipped to $100.93 in after-hours trading (as of 7:15 p.m. EDT).

Highlights from the first quarter of 2016include the following (reported in millions):

Net additions of members for the quarter were 6.74 million, surpassing Netflix’s previous high of 5.59 million achieved in the fourth quarter of last year. The company now has 81.5 million members with 58% in the U.S. and 42% abroad.

Netflix attributes some of the quarter’s success to the launch of two new series – Making a Murderer which launched in late December and Fuller House which launched in February. In addition, the dastardly Frank and Claire Underwood returned for the fourth season of House of Cards and Daredevil returned for its second season.

U.S. revenue grew 18% over the same period last year, and international revenue grew 57% year-over-year.  The international revenue growth can be attributed, in part, to Netflix’s expansion in January to nearly 130 more countries. This growth has been limited because Netflix is primarily offered in English and payments are restricted to international credit cards. The company is investing in non-English language series including Marseille (French), Hibana (Japanese), Suburra (Italian) and Dark (German) to be more appealing internationally.

So what’s next for Netflix? The upcoming price hike is the most visible change on the horizon. Starting in May, Netflix is phasing out the grandfathering of its $7.99 plan. Members can choose between the $7.99 one-screen plan, the $9.99 two-screen plan or the $11.99 four-screen plan. Netflix will implement the changes in the U.S. first and then internationally. The additional revenue raised from the price increase will help Netflix invest in additional content.

“We expect only modestly increased churn from un-grandfathering, partially because these members have been with us for a reasonable period already, and because our content continues to improve,” Netflix said in its April 18 letter to shareholders.

Netflix is forecasting the addition of 2.5 million members (0.5 from the U.S. and 2.0 internationally) and revenue of nearly $2 billion in the second quarter of 2016.

In terms of content, in quarter two, Netflix subscribers will see The Ranch, a sitcom starting Ashton Kutcher, and new seasons of original series, including Unbreakable Kimmy Schmidt, Bloodline, Grace and Frankie and Orange is the New Black.

Insider Take:

Is this first quarter report good news or bad news for Netflix? It depends on whom you ask. Thus far, the stock market has reacted negatively to the revised guidance for the second quarter and to the pending pricing changes. It looks like Netflix has adjusted accordingly though, and rather than rolling out all of the price increases in May, it will do them gradually throughout the remainder of the year. This will help level out any cash flow problems if significant churn occurs.

Except for the drop in share price which occurred prior to the earnings call, Netflix said the first quarter was off to a “great start” with “vast improvements in our service and content.”

USA Today speculated that Amazon Video is now a bigger threat to Netflix, especially after Monday’s announcement that Amazon Video will be available as a standalone subscription for $8.99 a month. Previously, it was only available as a part of Amazon’s Prime bundle which includes Amazon Video, free shipping, online photo storage, streaming music and more for $99 a year.

USA Today reported that Netflix CEO Reed Hastings said Amazon isn’t so much as a competitor as part of the “natural evolution from linear TV to Internet TV.”

“It’s natural that everybody is coming in as they realize that the future is Internet TV,” Hastings said.