After a rough first half of 2022, it appears there are some brighter days ahead for Netflix. The streamer released its Q3 earnings on Tuesday, beating the Wall Street estimates by a comfortable margin and causing its stock to surge.
Netflix shares closed at $240.86 on Tuesday before seeing a 14% jump in after-hours trading. It reached $278.20 per share at one point, which represents the highest price for Netflix stock since mid-April.
Highlighting Netflix’s Q3 results is a significant increase in subscribers. The streaming service added 2.41 million new users compared to an estimated 1 million. This was the first time Netflix recorded an increase in subscribers in 2022. The streamer lost around million subscribers in Q1, followed by an additional loss of 200K subscribers in Q2.
The company also saw revenue of $7.93 billion compared to the $7.85 billion expected and adjusted earnings per share (EPS) of $3.10 versus $2.22 estimated by Wall Street analysts.
“The key is pleasing members,” said the company in a letter sent to shareholders on Tuesday. “It’s why we’ve always focused on winning the competition for viewing every day. When our series and movies excite our members, they tell their friends, and then more people watch, join and stay with us.”
Netflix is expected to have a strong finish to the year as well, considering that the company is in the final stages of introducing an ad-supported subscription plan. The new tier will become available in November and will cost $6.99 on a monthly basis, which is $3 cheaper than the current most affordable plan.
