NFLX stock news today, Netflix (NFLX) shares experienced a notable surge today, driven by positive market sentiment and favorable news surrounding the company.
Record Subscriber Growth
Netflix stock hits all-time high in after-hours trading, Netflix (NFLX) shares surged over 14% in after-hours trading on Tuesday, reaching an impressive 18.9 million new users in the fourth quarter. This marks the largest quarterly subscriber gain in the company’s history, significantly beating expectations for the streaming giant.
Netflix Financial Highlights
Stock Buyback: Netflix announced a $15 billion stock buyback, which has further boosted investor confidence.
Revenue Outlook: The company raised its full-year revenue projection for 2025 to a range of $43.5 billion to $44.5 billion, surpassing the previous estimate of $43 billion to $44 billion.
Netflix Stock Current Prices
Closing Price: $869.68 (+1.35%)
After-Hours Price: $994.90 (+14.40%)
The subscriber growth comes as Netflix wrapped up 2024 with notable live events, including two NFL games and the much-anticipated boxing match between Jake Paul and Mike Tyson. Additionally, the return of "Squid Game" has contributed to the surge in viewership.
Netflix has announced price hikes across several plans, with the ad-supported plan rising to $7.99, the Standard plan going up to $17.99, and the Premium plan increasing to $24.99. Users will also see a $1 increase for adding an extra member, bringing the fee to $8.99.
Unexpected Netflix Subscriber Growth
Wall Street had anticipated that Netflix would report only 9.18 million new subscribers, following the addition of 13.12 million paying users in Q4 2023. The company has opted to stop reporting subscriber numbers starting this year.
Netflix Live Events Impact
During the earnings call, Co-CEO Greg Peters noted that the subscriber increase was not solely attributed to live sports. He emphasized a historical trend where no single title drives the majority of new customer acquisitions. For instance, the Jake Paul vs. Mike Tyson match attracted over 108 million global viewers, setting a record for the most-streamed sporting event ever.
Netflix Financial Performance Metrics
Revenue: Reached $10.25 billion in Q4, exceeding Bloomberg’s consensus estimate of $10.11 billion and representing a 16% year-over-year increase.
Earnings Per Share (EPS): Reported EPS was $4.27, beating expectations of $4.18 and significantly higher than the $2.11 EPS from the previous year.
Operating Margins: Operating margins for Q4 stood at 22.2%, with expectations to rise to 28.2% in Q1.
Netflix Competitive Landscape
Netflix acknowledged the intense competition it faces from both traditional entertainment and major tech companies. However, it remains focused on its unique offerings and continues to invest in content to maintain a strong market presence.
The impressive surge in subscriptions during the final quarter of last year has propelled Netflix's total paid memberships worldwide to 301.63 million, surpassing Wall Street's expectations of 290.90 million. This data was part of the California-based company's Q4 2024 financial results, which revealed earnings per share (EPS) of $4.27, exceeding the analysts' consensus forecast of $4.21. Additionally, Netflix reported a revenue of $10.25 billion for the period, surpassing the expected $10.11 billion. The company credited its strong performance to successful live sporting events and the return of hit shows like "Squid Game," which significantly contributed to the influx of new subscribers.
Netflix also aired two live NFL games on Christmas Day. In its earnings announcement, the company revealed plans to increase prices for most streaming plans in the U.S., Canada, Portugal, and Argentina, with the ad-supported basic plan rising by $1 to $7.99, marking a 14% hike, while the ad-free premium package will increase to $24.99, a 9% rise. Over the past year, NFLX stock has appreciated by 79%. Currently, Netflix holds a consensus Moderate Buy rating among 30 Wall Street analysts, based on 21 Buy, seven Hold, and two Sell recommendations. The average price target for NFLX stands at $951.60, suggesting a potential upside of 9.42% from current levels.
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