Null Photo | Null Photo | Getty Images
Los Angeles — Netflix on Thursday reported third-quarter financial results that outperformed sales and bottom line, with continued growth in its advertising business.
The streamer’s ad tier membership grew 35% sequentially. The company plans to launch in Canada next quarter and more broadly in 2025.
Netflix does not expect advertising to be a major growth driver until 2026, but noted that it accounted for more than 50% of sign-ups in the third quarter in countries where the advertising tier is available.
Shares rose about 5% in aftermarket trading.
Here’s what Netflix reported for the period ending September 30th:
- Earnings per share: $5.40 vs. LSEG Forecast $5.12
- Revenue: $9.83 billion vs. LSEG’s expected $9.77 billion
- Paid membership: 282.7 million vs. expected 282.15 million, according to StreetAccount
Net income for the period was $2.36 billion, or $5.40 per share, compared to $1.68 billion, or $3.73 per share, in the prior-year period. Sales increased 15% to $9.83 billion from $8.54 billion in the same period last year.
The company on Thursday said it expected fourth-quarter sales of $10.13 billion and earnings of $4.23 per share.
Netflix projects full-year revenue of $43 billion to $44 billion in 2025 as it improves its core series and movie offerings and invests in new initiatives such as advertising and gaming. Much of the increase in revenue is expected to be due to what the company calls a “healthy increase in the number of paid members.”
According to estimates from Street Accounts, Netflix gained 5.1 million subscribers during the quarter, more than the 4.5 million that Wall Street had expected. The streaming service currently has a total of 282.7 million members across all price points.
Starting in 2025, Netflix will no longer update investors on subscriber numbers as it shifts focus to revenue and other financial metrics as performance metrics.
The company is launching new shows such as “The Perfect Couple,” “Nobody Wants This,” and “Tokyo Swindlers,” as well as reseasons of “Emily in Paris” and “Cobra Kai,” as well as “Beverly Hills.” It also promoted major movies such as “Cops: Accelerator”. F,” “Rebel Ridge,” and “Officer Black Belt” all had huge ratings gains.
Netflix announced its popular show “The Squid Game” in the fourth quarter, along with live sports events such as a boxing match between Jake Paul and Mike Tyson, and two National Football League Christmas Day games. We are planning to release the second season of.
Correction: This article has been updated to correct Netflix’s third-quarter reporting and estimated revenue. The company reported sales of $9.83 billion, compared to expectations of $9.77 billion, according to LSEG.
