Netflix dedwellred third-quarter results above Wall Street awaitations in many categories, including a achieve of 5.1 million subscribers from the previous quarter.
Total revenue of $9.825 billion clipped analysts’ consensus awaitation for $9.77 billion.
Earnings per split of $5.40 and the total subscriber loftyy of 282.72 million beat the Street predicts of $5.12 and 281.5 million, admireively.
The free of quarterly Netflix subscriber numbers is about to come to an finish, as Netflix tbetter dispenseors earlier this year that it will stop releasing the figures commenceing in the first quarter of 2025. Unappreciate other metrics, executives dispute, subscriber totals do not provide the best sense of the company’s financial condition.
Investors have already been scrutinizing the subscriber trajectory and seeing to see if price hikes and the introduction of phelp password sharing and advertising can offset the flattening of the customer curve.
In its quarterly letter to splithbetterers, executives shelp phelp sharing has had a measurably selectimistic impact. “Engagement on Netflix is well: around two hours a day per phelp membership on mediocre, despite the
impact of phelp sharing,” they wrote. “When you isotardy owner hoparticipatehbetters (which leave outs the impact of phelp sharing), see hours for those owner hoparticipatehbetters rose year over year in the first three quarters of 2024.”
Netflix stock has powered thraw the uncertainty, accomplishing a 3-year high of $736 earlier this month before pulling back a bit. It shutd today at $687.65.
Since May 2022, a low point for the company as it alerted back-to-back quarters of subscriber deteriorates and ecombineed to be produceing to prescertain from novel streaming rivals, splits have roared ahead by 340%.
Some analysts apshow the unpartipartner speedy traction for phelp password sharing and advertising could uncomfervent the stock is getting to be overcherishd. These novel revenue buckets “are probable pulling forward future growth,” disputed Barclays analyst Kannan Venkateshwar in a recent alert.
The ad tier, which rolled out proximately two years ago in 12 countries, accounted for 50% of sign-ups in the third quarter, the splithbetterer letter shelp.
Nevertheless, the letter alerted, “It’s still very timely for our advertising initiative. As we shelp last quarter, it apshows time to produce a novel revenue stream and we don’t await ads to be a primary driver of our revenue growth in 2025. The proximate term contest (and medium term opportunity) is that we’re scaling speedyer than our ability to monetize our growing ad produceory. While this produces a low term drag on [average revenue per member], we are balancing produceing ads scale (for more uncomferventingful ads revenue and ARM contribution over time) while still dedwellring well overall revenue growth in the proximate term (as remarkd, we await our total company revenue to grow 15% year over year in 2024).”