Netflix shares rose 11% Friday on third quarter financial results that beat expectations. Netflix with ads membership jumped 35% compared to the second quarter 2024.
Revenue was $9.83 billion, compared with expectations of $9.77 billion. File Photo by Christian Monterrosa/ EPA-EFE
Oct. 18 (UPI) — Netflix shares rose 11% Friday on third-quarter financial results that beat expectations. Netflix with ads membership jumped 35% compared to the second quarter of 2024.
Both revenue and earning per share beat estimates. Revenue was $9.83 billion, compared with expectations of $9.77 billion.
Net income was $2.4 billion.
Netflix said earnings per share was $5.40, higher than the LSEG consensus estimate of $5.12.
CNBC’s Squawk Box Europe executive director Richard Broughton said Friday, “It’s a good indicator that some of the growth that dropped out of the market in 2022 is returning. If you think about the last 24 months, we’ve had cutbacks in content expenditure, hiring freezes, redundancies in some of the major studios and streamers. And all through this, Netflix has tried to keep investing in content. That sets it up extremely well over the next couple of years.”
Netflix said it expects fourth-quarter results to increase to $10.13 billion.
Subscribers grew by 5.1 million, posting a 14% gain year-over-year.
While Netflix did not announce any price increases in the United States, it indicated subscription prices were increased recently in Europe, the Middle East, Africa, Japan, Spain and Italy.
Netflix said in a Thursday shareholder letter that third quarter revenue “grew 15% year over year and operating margin was 30% vs. 22% last year. For 2024, we expect revenue growth of 15%, and operating margin of 27%.”
Netflix added that viewer engagement is strong.
“Engagement, our best proxy for member happiness, remains healthy,” Netflix said in the shareholder letter. “Through the first three quarters of 2024, view hours per member amongst owner households (the clearest view of engagement trends post the introduction of paid sharing) increased year over year.”
According to Netflix, paid subscribers watch an average of two hours per day.