Netflix has given investors and investors a look at its books.
At the end of the fourth quarter of 2024, Netflix had a profit of $4.27 per share on its books, which was more than a year ago ($2.15 per share). Analysts’ previous EPS estimates were $4.21 per share.
The streaming giant’s sales in the reporting period – after $8.83 billion in the previous year – were now $10.2 billion. Fourth-quarter revenues were above analysts’ estimates of $10.11 billion.
Netflix added 18.9 million subscribers in its holiday quarter, beating Wall Street forecasts. Live sporting events and the return of the popular South Korean series “Squid Game” attracted record numbers of new customers, the company reported Tuesday.
Netflix with a record increase of almost 19 million users
After record growth in the last quarter, Netflix broke the 300 million user mark. In the quarter with the release of the second season of the South Korean hit series “Squid Game,” almost 19 million users were added. That was about twice as much as analysts expected – the video streaming market leader also exceeded Wall Street forecasts for sales and profits. With the tailwind, Netflix immediately increased prices in the most important market, the USA. The results were very well received on the stock market.
Netflix now has 301.6 million customer households. The largest increase to date in a quarter was around 15 million at the beginning of the corona pandemic in 2020. With the record, however, Netflix will now stop providing information on the number of users. This was already announced last year.
This is how Netflix shares react
Netflix’s revenue rose 16 percent year-over-year to $10.2 billion last quarter. The bottom line is that profits jumped from $938 million a year earlier to $1.87 billion. The results were well received by investors: in after-hours trading on the US stock exchange NASDAQ, Netflix shares temporarily rose by 14.4 percent to $994.90. If the paper were to increase so strongly in regular trading, it would be more expensive than ever before.
Netflix shares have been one of the strongest stocks in the NASDAQ 100 over the past two years. Since an interim low in spring 2022, the market capitalization had more than quintupled by the end of trading on Tuesday and was most recently at just over $370 billion and could climb above the $400 billion mark for the first time on Wednesday. In the past ten years, the price has risen by almost 1,400 percent.
Netflix went public in 2002. The placement price was $15. Adjusted for stock splits, this was just over a dollar. Anyone who had invested $1,000 back then would have assets of just over $800,000 as of Tuesday’s closing price.
Live events also attracted spectators
The second season of “Squid Game” is now the third most successful Netflix series – behind season one and the American comedy-horror series “Wednesday”. At the same time, there were two live events in the last quarter that interested many users: a boxing match between veteran star Mike Tyson and influencer Jake Paul and the first Netflix broadcast of two games from the NFL football league.
At the same time, co-chief executive Ted Sarandos made it clear that Netflix is more interested in attracting potential new long-term customers with individual sports broadcasts rather than expensively buying the rights for an entire season of the major leagues. At the same time, Netflix will show the 2027 and 2031 Women’s World Cup.
Live is good for the advertising business
Live programming plays an important role in Netflix’s advertising business. The streaming service, which was once completely free of advertising, is now increasingly relying on a cheaper subscription with ads. This means that Netflix is also attracting advertising expenditure that previously went to classic linear TV. According to Netflix, in the twelve markets where the subscription with advertising is available, the majority of new customers choose it.
Editorial team finanzen.net / LOS GATOS (dpa-AFX)
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