Netflix late Tuesday beat estimates for the fourth quarter thanks to a surge of new subscribers. Netflix stock jumped in extended trading.
The internet television network earned $4.27 a share on sales of $10.25 billion in the December quarter. Analysts polled by FactSet had expected earnings of $4.21 a share on sales of $10.11 billion. On a year-over-year basis, Netflix earnings rose 102% while sales climbed 16%.
Netflix added 18.91 million new subscribers in the fourth quarter, ending 2024 with 301.63 million subscribers worldwide. Wall Street had modeled for 10.18 million net new subscribers.
This is the last quarter that Netflix plans to report quarterly subscriber numbers. It wants investors to focus on revenue and operating margin instead.
"Our Q4 slate outperformed even our high expectations," the company said in a shareholder letter. "'Squid Game' season 2 is on track to become one of our most watched original series seasons, 'Carry-On' joined our all-time Top 10 films list, the Jake Paul vs. Mike Tyson fight became the most-streamed sporting event ever and on Christmas Day we delivered the two most-streamed NFL games in history."
In after-hours trading on the stock market today, Netflix stock popped more than 13% to 983.59. During the regular session Tuesday, Netflix stock rose 1.4% to close at 869.68.
Netflix Gives Mixed Outlook
Netflix's guidance for the current quarter was below views, but its outlook for the full year was above estimates.
For the first quarter, Netflix expects to earn $5.58 a share on sales of $10.42 billion. Wall Street had been looking for earnings of $5.97 a share on sales of $10.49 billion. In the year-earlier period, Netflix earned $5.28 a share on sales of $9.4 billion.
Netflix's Q1 guidance calls for earnings per share to increase 5.7% from the year-ago quarter with revenue up 11.2%.
For the full year, Netflix is targeting revenue of $43.5 billion to $44.5 billion. The midpoint of $44 billion topped the consensus estimate of $43.6 billion.
Last month, Netflix Co-Chief Executive Ted Sarandos called the company's 2025 content slate "an embarrassment of riches." Netflix's upcoming programs include fresh seasons of hit shows "Stranger Things," "Squid Game," "Wednesday," "The Night Agent," "Emily in Paris" and "Ginny & Georgia." It also will be launching new series and major movie premieres.
Follow Patrick Seitz on X, formerly Twitter, at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
