Internet television network Netflix late Thursday beat Wall Street's estimates for the second quarter. But Netflix stock wavered in extended trading on the company's soft revenue outlook.
The streaming video leader added 8.05 million subscribers in the June quarter, ending the period with 277.65 million total subscribers worldwide. Analysts had expected Netflix to gain 4.53 million new subscribers.
The Los Gatos, Calif.-based company earned $4.88 a share on sales of $9.56 billion in the second quarter. Analysts polled by FactSet had predicted Netflix would earn $4.74 a share on sales of $9.53 billion. On a year-over-year basis, Netflix earnings rose 48% while revenue increased 17%.
Netflix's Q2 report marked the company's fourth straight quarter of accelerating sales growth. But Netflix signaled slowing growth in the current quarter.
For the current quarter, Netflix forecast earnings of $5.10 a share on sales of $9.73 billion. Wall Street was looking for earnings of $4.74 a share on sales of $9.81 billion in the third quarter. Netflix's guidance would translate to year-over-year growth of 37% in earnings and 14% in sales.
Netflix Stock Continues Retreat
Netflix did not give a specific forecast for new subscribers in the current quarter. "We expect paid net additions to be lower than Q3 '23, which had the first full-quarter impact from paid sharing," Netflix management said in a shareholder letter.
In the third quarter last year, Netflix added 8.76 million new subscribers.
In after-hours trading on the stock market today, Netflix stock initially fell but recovered to a modest gain in recent trades. During the regular session Thursday, Netflix stock fell 0.7% to close at 643.04.
Netflix shares have fallen for six of the last seven regular sessions.
Netflix stock is on two IBD lists: Big Cap 20 and Stock Spotlight.
Follow Patrick Seitz on X, formerly Twitter, at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
