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Netflix added millions more subscribers in the fourth quarter than Wall Street expected, helping to send shares of the streamer up after the bell despite a big earnings miss.
The company also disclosed that co-CEO Reed Hastings would be stepping down from his position and transitioning to the post of executive chairman. Greg Peters, the company’s chief operating officer has been promoted to co-CEO alongside the already established Ted Sarandos.
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Here are the results:
- EPS: 12 cents vs 45 cents per share, according to Refinitiv.
- Revenue: $7.85 billion $7.85 billion, according to Refinitiv survey.
- Global paid net subscribers: 7.66 million adds, compared to 4.57 million subscribers expected, according to StreetAccount estimates.
Netflix touted new releases like the television series “Wednesday,” the docuseries “Harry and Meghan” as well as Rian Johnson’s film “Glass Onion” as popular content during the quarter.
Last quarter, the streamer said it was “very optimistic” about its new advertising business. While it doesn’t expect the new tier will add a material contribution to its fourth-quarter results, it foresees membership growing gradually over time.
Heading into Thursday’s report, analysts are expecting the company to announce an additional 4.57 million paid subscribers, on pace with Netflix’s own projection of 4.5 million. The number would be stronger than the 2.4 million the service added in the previous quarter and significantly better than the declines it saw in the first half of the year.
Going forward, Netflix will no longer give subscriber guidance, although it will still report those numbers in future earnings reports. The rationale is that the company is growing its focus on revenue as its primary top line metric instead of membership growth.
