Netflix shares dipped about 1% after-the-bell Tuesday after the corporate posted third quarter outcomes, exhibiting buyers the streamer can proceed to draw new subscribers.
- Earnings per share (EPS): $3.19 vs $2.56 in line with Refinitiv survey of analysts
- Income: $7.48 billion vs $7.48 billion, in line with Refinitiv
- International paid internet subscriber additions: 4.4 million vs 3.84 million, in line with StreetAccount
The quarter’s subscriber development of 4.4 million was a strong beat over the anticipated 3.84 million. Analysts had anticipated customers to flock to the streamer because it started to roll out a slew of content material that was delayed to the again half of the yr because of the pandemic.
The corporate mentioned it expects so as to add 8.5 million subscribers within the fourth quarter.
“We’re in uncharted territory,” Netflix co-CEO Reed Hastings mentioned on the corporate’s post-earnings video interview. “We now have a lot content material coming in This fall like we have by no means had, so we’ll must really feel our means by means of and it rolls into an amazing subsequent yr additionally.”
Netflix mentioned in its letter to buyers it plans to have a extra regular launch schedule over the course of 2022, barring any Covid-related delays.
Netflix additionally introduced it is going to use new metrics for reporting viewership. The corporate will begin reporting hours seen reasonably than the variety of accounts that watched.
For instance, the corporate’s present prime movie is “Extraction,” with 99 million accounts having watched a minimum of two minutes of the title in its first 28 days on Netflix. Future reporting would put “Chicken Field” as the highest movie, with 282 million complete hours seen in its first 28 days.
The corporate mentioned in a letter to buyers that the brand new metrics “matches how exterior companies measure TV viewing and provides correct credit score to rewatching.”
Netflix may even launch title metrics extra often exterior of its earnings report, it added.
The corporate additionally gave a nod to the highest present of the quarter, “Squid Recreation.” Netflix mentioned the South Korean dystopian sequence has develop into its “greatest TV present ever.” The corporate mentioned 142 million member households globally watched the present in its first 4 weeks.
The corporate additionally pointed to the cultural relevance of the present.
“Like a few of our different huge hits, Squid Recreation has additionally pierced the cultural zeitgeist, spawning a Saturday Evening Reside skit and memes/clips on TikTok with greater than 42 billion views,” the corporate mentioned. Demand for shopper merchandise associated to the present is excessive, it added.
Even Hastings wore the inexperienced tracksuit that was popularized by the present through the firm’s earnings interview.
Netflix additionally up to date buyers on its push into gaming. The corporate mentioned it is begun testing its video games in choose international locations, however “it stays very early days for this initiative.”
The video games will probably be part of Netflix subscriptions and won’t embrace ads or in-app purchases.
Netflix nonetheless desires to seize extra customers’ consideration, competing towards actions like watching TikTok, enjoying Fortnite or studying. It shared some perception into that dynamic, saying that when Fb skilled a worldwide outage earlier this month, Netflix noticed engagement enhance 14% throughout that very same time interval.
Stepping into gaming might convey Netflix customers to spend extra time on the platform, exterior of watching conventional exhibits or movies.
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