Netflix shares skyrocketed by over 14% on Tuesday January 21, following a record-breaking fourth quarter that exceeded Wall Street expectations in revenue, earnings, and subscriber growth.
Netflix’s fourth-quarter revenue rose 16% year-over-year to $10.25 billion, surpassing analyst predictions of $10.11 billion. Earnings per share climbed to $4.27, outpacing the $4.20 forecasted by analysts. Net income nearly doubled from $938 million a year earlier to $1.87 billion.
The streaming giant reported an impressive 301.63 million paid memberships, adding a record 19 million new subscribers in the quarter. Additionally, Netflix estimated its global audience, including extra member accounts, to exceed 700 million viewers.
Netflix’s fourth-quarter content lineup proved pivotal in attracting new subscribers. Highlights included the release of Squid Game Season 2, live NFL games on Christmas Day, and a highly anticipated Jake Paul vs. Mike Tyson boxing match. These events not only drew audiences but also demonstrated strong retention rates.
Other standout titles included Carry On, Black Doves, Six Triple Eight, and Nate Bargatze’s comedy special. Co-CEO Ted Sarandos highlighted that new subscribers who joined for these marquee events remained engaged with the platform’s broader catalog.
Netflix raised its full-year revenue projection to $43.5–$44.5 billion, reflecting improved business fundamentals and the momentum from its strong fourth-quarter performance.
This quarter marks the last time Netflix will report paid subscriber counts quarterly. Moving forward, the company will provide bi-annual “engagement reports” alongside second- and fourth-quarter earnings.
Netflix also plans to expand its content library with major releases in 2025, including Stranger Things and Wednesday returns, as well as new films like Knives Out 3, Happy Gilmore 2, and Guillermo del Toro’s Frankenstein.
Netflix reported significant growth in its ad-supported tiers, which now account for over 55% of sign-ups in applicable markets. Memberships for these tiers grew 30% quarter-over-quarter, signaling strong consumer demand for cost-effective options.
To further capitalize on this success, Netflix plans to enhance its ad offerings for advertisers, aiming to achieve greater scale in 2025. Alongside these efforts, Netflix announced price increases of $1–$2 for select streaming tiers, ensuring sustained revenue growth.
Netflix’s strategic focus on diverse content, live events, and expanding its ad-supported options has positioned the company for continued success. With blockbuster titles and innovative offerings on the horizon, Netflix remains a leader in the streaming industry.
