Streaming giant Netflix Inc NFLX reported third-quarter financial results after market close Thursday.
Here are the key highlights.
What Happened: Netflix reported third-quarter revenue of $9.825 billion, up 15% year-over-year. The revenue total beat a Street consensus estimate of $9.769 billion according to data from Benzinga Pro.
The company reported earnings per share of $5.40 in the third quarter, beating a Street consensus estimate of $5.12.
Netflix ended the third quarter with 282.72 million global paid subscribers, up 14.4% year-over-year. The company added 5.07 million new paid subscribers in the quarter, compared to 8.8 million net paid subscribers added in last year's third quarter.
The company said average revenue per member was flat on a year-over-year basis in the third quarter.
Revenue was up 16% year-over-year in the UCAN region. Revenue in the EMEA region was up 16% year-over-year. LATAM revenue was up 9% year-over-year.
The company said engagement remained strong in the third quarter. Through the first nine months of the year, view hours per member are up year over year. Engagement averages around two hours per day per paid membership.
Netflix said ad-supported plan membership was up 35% quarter-over-quarter in the third quarter. The company's ad-tech platform is "on track to launch" in the fourth quarter in Canada and other territories in 2025.
"Our ads plan allows us to offer a lower price point for consumers, which is proving to be popular," the company said.
Netflix said the ad-supported plan represented over 50% of new sign-ups in the third quarter.
"Our members rely on Netflix to entertain them, and we want to be the first place they go for entertainment."
What's Next: Netflix is guiding for fourth-quarter revenue to be $10.128 billion, up 14.7% year-over-year. The company's earnings per share guidance calls for the fourth quarter total to be $4.23, compared to $2.11 in last year's fourth quarter.
Netflix said the ad-supported plan efforts are still early and will take time to build out as a revenue stream.
"We're on track to reach what we believe to be critical ad subscriber scale for advertisers in all of our ads countries in 2025, creating a strong base from which we can further increase our ad membership in 2026 and beyond," the company said.
The company highlighted upcoming fourth-quarter content, including the boxing match between Jake Paul and Mike Tyson, a second season of "Squid Game", and two National Football League games on Christmas.
"As we look ahead to 2025, we're focused on improving every aspect of our service and continuing to deliver healthy revenue and profit growth."
Due to seasonality and the strong content slate, fourth-quarter paid net additions are expected to be higher than the third-quarter total.
Netflix expects 2025 revenue to range from $43 billion to $44 billion.
NFLX Price Action: Netflix stock is up 4% to $715.37 in after-hours trading Thursday, versus a 52-week trading range of $344.73 to $736.00.
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Photo courtesy of Netflix.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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