Netflix Adds 5.1M Subscribers, Beating Wall Street Forecasts, But Revenue Comes In A Bit Light

Netflix delivered a mixed set of third-quarter results, beating Wall Street estimates for earnings per share and subscriber growth but falling short on revenue.

Total revenue of $9.559 billion fell short of analysts’ consensus for $9.77 billion.

Earnings per share of $5.40 and total subscriber tally of 282.72 million beat the Street forecasts of $5.12 and 281.5 million, respectively.

The release of quarterly Netflix subscriber numbers is about to come to an end, as Netflix told investors earlier this year that it will stop releasing the figures in 2025. Unlike other metrics, executives argue, subscriber totals do not offer the best sense of the company’s financial condition.

Investors have already been scrutinizing the subscriber trajectory and looking to see if price hikes and the introduction of paid password sharing and advertising can offset the flattening of the customer curve.

Netflix stock has powered through the uncertainty, reaching a 3-year high of $736 earlier this month before pulling back a bit. It closed today at $687.65.

Since May 2022, a low point for the company as it reported back-to-back quarters of subscriber declines and appeared to be succumbing to pressure from new streaming rivals, shares have roared ahead by 340%.

Some analysts believe the fairly quick traction for paid password sharing and advertising could mean the stock is getting to be overvalued. These new revenue buckets “are likely pulling forward future growth,” argued Barclays analyst Kannan Venkateshwar in a recent report.

MORE to come …