Science - Technology

Netflix added 18.9 million subscribers in Q4

TH (according to VNA) January 22, 2025 21:20

Netflix said it added 18.9 million subscribers in the fourth quarter, beating Wall Street forecasts and continuing to demonstrate its leadership in the streaming market.

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Netflix logo on computer and mobile phone screens in Arlington, Virginia, US

Netflix's impressive numbers in the fourth quarter were explained by the appeal of a series of exciting live sports events as well as the return of the hit Korean movie Squid Game.

Netflix's fourth-quarter revenue rose 16% year over year to $10.2 billion — up from Wall Street's estimate of $10.1 billion. Meanwhile, earnings per share were $4.27, beating Wall Street's forecast of $4.20.

Investors reacted positively to Netflix’s earnings and outlook. Shares jumped about 13% in extended trading, giving the company a market value of nearly $50 billion. Netflix shares have risen more than 77% over the past year, far outpacing the 24% gain in the S&P 500, an index of the 500 largest publicly traded companies in the United States.

“We are entering 2025 with strong momentum,” Netflix said in a note to investors. The company also announced that it added a record 41 million subscribers in 2024 and is accelerating again.

The company also revised its 2025 revenue forecast from $43.5 billion to $44.5 billion, saying the update reflects the current business environment.

Netflix said its fourth-quarter streaming exceeded expectations, with the Jake Paul-Mike Tyson boxing match becoming the most-streamed sporting event, and two National Football League games on Christmas Day among the most-streamed in the league’s history.

The company is also said to be benefiting from the second season of the survival drama Squid Game, which is on track to become one of the most-watched original series on the platform. It also has one of the lowest customer churn rates among streaming services, with Netflix’s customer churn rate at just 1.8% in December, according to research firm Antenna.

"Netflix has cemented its leadership and is completely outpacing the streaming market," said Paolo Pescatore of research firm PP Foresight. "Netflix is ​​now demonstrating its strength by increasing its prices because its programming portfolio is much better and more diverse than its competitors."

Accordingly, the streaming giant said it will increase prices for most service packages in some countries in the Americas such as the US, Canada, Portugal and Argentina. In the US, the basic service with ads will increase by $1/month to $7.99, a 14% price increase, while the premium package will cost $24.99, a 9% increase compared to the current price.

The company said Netflix has weathered the impact of the Covid-19 pandemic, the Hollywood writers and actors strike, and is returning seasons of its most popular shows, including Wednesday, a series based on a character in the Addams Family entertainment series, as well as the supernatural series Stranger Things.

Netflix will also offer viewers more live events, including weekly WWE Monday Night Raw wrestling shows and films like Wake Up Dead Man: A Knives Out Mystery starring Daniel Craig as detective Benoit Blanc and a new version of Frankenstein from Academy Award-winning director Guillermo del Toro.

Netflix has also won the rights to broadcast the FIFA Women's World Cup in 2027 and 2031, a deal the company said illustrates its strategy of offering special event programming rather than its usual seasonal sports packages.

Macquarie Equity Research analyst Tim Nollen predicts Netflix’s advertising revenue will grow to $2 billion by 2025 as more people subscribe to its advertising services and as its ad technology improves. Additionally, live events will continue to drive advertising subscriptions from Netflix customers.

The fourth quarter of 2024 will be the last quarter Netflix reports new subscribers. Instead, the company will only report revenue and profit figures — a change that analysts say is due to a slowdown in the pace of new signups.

TH (according to VNA)
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Netflix added 18.9 million subscribers in Q4