At first glance, it looks like the company beat them. Netflix (NFLX) posted earnings of 37 cents a share on revenue of $394.1 million. Wall Street had been looking for 31 cents and $390 million, respectively. The company said it ended the quarter with 10.3 million subscribers, which is the high end of the range it had promised to deliver.

And guidance was strong, too. From the company’s press release, here are Q2 predictions:

– Ending subscribers of 10.4 million to 10.6 million
– Revenue of $403 million to $409 million
– GAAP net income of $27 million to $32 million
– GAAP EPS of 44 cents to 53 cents per diluted share

And here’s the company’s revised guidance for 2009 (full year), which it increased:

– Ending subscribers of 11.2 million to 11.8 million, up from 10.6 million to 11.3 million
– Revenue of $1.63 billion to $1.67 billion, up from $1.58 billion to $1.635 billion
– GAAP net income of $96 million to $106 million, up from $88 million to $98 million
– GAAP EPS of $1.56 to $1.72 per diluted share, up from $1.43 to $1.59 per diluted share.

All of this seems to compare favorably with Wall Street’s expectations. Via Citibank’s Mark Mahaney, here’s what investors were looking for (click to enlarge):

Netflix shares have been bouncing around in the aftermarket following the earnings release, and last I looked, they’re just about flat. It will probably take investors a while to figure out if they’re disappointed that the numbers aren’t even bigger.

UPDATE: The stock is now down around 5%, presumably because guidance wasn’t strong enough. I’m back for the earnings call, which I’ll live blog part of: I’m particularly interested in Netflix’s digital strategy, so I’ll be focusing on that.

CEO Reed Hastings: Subscribers renting more DVDs and Blu-rays than ever. Disc rental will continue to grow for many years, so we’re investing in that.

More realistic Blu-ray pricing (previously discussed) of 20% to 25% premium for subs. Though we’re paying the studios a higher premium for Blu-ray. If we can get those costs in line, we can promote Blu-ray more agresssively [i.e. bring down your prices, Hollywood, and we'll push more of your high-margin discs].

We are losing customer to $1 kiosk rentals. “By end of they year, kiosks will likely be our #1 competitor,” as rental stores fail. “Longterm effects,” of cheap kiosks “are not positive for us, or the industry as a whole.”

Streaming: Overall consumer embrace of online video growing. “Not hard to believe that online video will grow substantially every year for a long time”. [Duh]. Important for us to be spending “aggressively” on streaming content. “But that means we are essentially buying many titles twice now”. Buying once on DVD, and again on streaming. Great for content owners, ok for us since costs for streaming are lower than physical distribution.

We believe we’ll get more streaming licenses as TV networks, who control titles, look to increase distribution. We are looking to a day, when we have plentiful content for streaming… “we will simply be a fourth option for consumers and a fourth revenue source for networks and studios”. It’s possible that within a few years, all CE devices sold will include a Netflix component.

It’s easy to focus on the Internet for its distribution abilities, but its important to think about social possibilities. Future of Internet TV is closer to Facebook and social networks than the standard grid lineup. Social, social, social. Long term outlook for Internet TV is very promising.

[Join to pass on most of CFO notes] No “cocooning” effect from recession apparent in DVD usage. Acquisition costs “record low” in part because of depressed online ad pricing.

Q&A: “Tremendous amounts” of hardware partnerships in the pipeline. Xbox renewal? No answer.

Have sub growth slowed at end of quarter? No. Q4 growth back-end loaded because of holidays, and Q1 growth front-end loaded for same reason.

How about a fee-based service for a streaming only service by year’s end? We talk about that from time to time, but not pressing. For now, combination of DVD rental and streaming is what consumers are interested in. A streaming-only service would be a “sweetner” to what we have now. We don’t think it would cannibalize, though.

Can you talk about streaming-enabled devices’ contribution to subscriber additions? No details, but we think it’s helpful to have Xbox, Blu-ray players, etc. “It’s definitely a very positive part of the ecosystem for us”.

What are dynamics to adding more content to streaming library? More money.

Can you talk more about new marketing efficiencies? There aren’t any new ones, really. Weak economy, lower ad prices, plus consumer excitement about streaming product.

What does competition look like on streaming front from Apple and Amazon? Right now, “all three of us are three drops of water in the pool that is watching television”, … “we all recognize in the long-term there will be competition between us” but we’re all “so tiny” compared to TV-viewing that that’s what we’re focused on.

That appears to be it for streaming-related queries. I’ll check back in with the full transcript later on.

People today use the Netflix service on their computers, but Netflix (NFLX) has cut a series of deals with hardware partners to make the service available on TV sets through an array of devices.

Most of these devices were designed to do other things: a videogame console, high-definition Blu-ray disc players, a TiVo (TIVO) digital video recorder. So to see how well the service works on these devices, I’ve spent the past couple of weeks comparing the Netflix experience on Microsoft’s (MSFT) Xbox 360 game console, on LG Electronics’ BD300 Blu-ray disc player and on a set-top box from Roku called the Netflix Player. The last, as the name implies, is designed mainly for Netflix service.

The devices suffer from a relatively skimpy selection of videos on the Netflix Internet service. Netflix has more than 100,000 titles for rent on disc, but about 12,000 titles for viewing through its Internet service at the moment, and there’s often a months-long delay after a movie’s release before it shows up online. Television shows generally turn up more quickly, with a handful, like NBC’s “Heroes,” watchable the day after they air.

Still, I find the Netflix service very appealing, especially for catching up on episodes of TV series, such as “30 Rock,” that I missed when they aired. Unlike the iTunes Store and other sites that charge users $1.99 per TV episode and $3.99 to rent a movie online, the Netflix Internet service is free to subscribers to its DVD service on one of the company’s “unlimited” rental plans, which start at $8.99 a month.

Depending on how fast your Internet connection is, Netflix videos begin playing almost instantly, though you can’t keep permanent copies.

Connecting the devices to Netflix through my wired home network was easy in all three cases. I used a wireless home network — more common in homes than the wired variety — with the Roku device, the only one of three products that comes with built-in Wi-Fi (it worked well in this mode). People who want to use the Xbox 360 with a wireless network will have to spend $70 or so on an external Wi-Fi adapter. LG recommends people use only a wired home network to connect to Netflix from its player, including adapter kits that cost about $100 for transmitting data over home power lines.

All the devices require you to create a list of movies you want to watch from a computer, just like Netflix subscribers set up “queues” of DVDs to be delivered by mail. The Xbox 360 offered by far the most elegant-looking interface for browsing through videos in my Netflix queue, letting me glide through a long row of cover art representing the movies and TV shows I selected on my PC.

In contrast, the Netflix menu on the LG Blu-ray player and Roku device were more static, making it more awkward to navigate the expanse of titles. Netflix became available on the Xbox 360 in November as part of a more sweeping software upgrade, delivered over the Internet, that remade the graphical look of the system.

The quality of most of the videos on Netflix is, to my eyes, about DVD quality, though Netflix is adding some titles in high-definition to its Internet library. HD titles were available for viewing only through the Xbox 360 when I was testing the service. Roku and LG say they will make software updates available online this month that add HD support to their devices.

The Xbox 360 also has some annoying quirks when using it as a movie player — including a noisy fan I found distracting. The game controller that comes with the Xbox 360 is clunky for playing movies, so users will need to invest in an inexpensive additional remote-control design for media. The Roku and LG players, in contrast, were totally silent and had acceptable remote controls for watching Netflix videos.

I experienced the most serious glitches with the LG Blu-ray player, which occasionally dropped the video signal to my television set as I was watching a movie. LG says the loss of video signal could have been due to the connection I used to hook the player to my TV, though I’ve never had a problem with other devices using the same connection. The LG Blu-ray player also took the longest of all the devices to install software upgrades from the Internet.

While there are some differences in the Netflix experience on the Roku device, Xbox 360 and LG Blu-ray player, none of them is so great that they should trump other considerations — like a desire to play videogames or watch HD Blu-ray movies — in deciding which system is the best fit.

The LG Blu-ray player is available online for about $300. The cheapest Xbox 360 model is $199. (To get Netflix through the Xbox 360, users must be “gold” members to the $49.99-a-year Xbox Live game service.) But if what you’re after is primarily Netflix movies, and you’ve got room near your TV for another box, the $99.99 Roku product is the best value.

Walt Mossberg is on vacation.

Write to Nick Wingfield at nick.wingfield@wsj.com