The quarterly earnings of the biggest movie streaming platform Netflix are out and they are everything close to impressive. Following the announcement of its third-quarter results, the company saw its shares go up slightly after-the-bell Tuesday.
The earnings results are a boost to the confidence that investors have in the company. The company recorded earnings per share (EPS) of $3.19 as against the $2.56 that Refinitiv analysts expected. Revenue was on point with expectations of $7.48 billion. One important metric that seems to interest everyone is Netflix’s Global paid net subscriber additions. The company added 4.4 million new subscribers globally. The expected number was 3.84 million according to StreetAccount. The Global paid net subscriber of 4.4 million beats every expectation hands down as the effect of the pandemic which slowed down the production of many movies and series was expected to affect the streaming platform. Analysts had expected movies and series watchers to rush back to the platform as new content was being made available, as Netflix began to make new content available following the ease of the pandemic and lockdowns.
Netflix has high hopes for the next quarter. It expects to add 8.5 million subscribers in the fourth quarter as well as have a normalized release schedule from next year with hopes that the effect of the pandemic would have drastically faded off.
Netflix is also making slight changes to how it reports its viewership following its successful viral hit “Squid Game” which garnered over 142 million views in about a month. Netflix reported this viewership with the number of accounts that watched at least two minutes of the show over a period of time, usually 28 days. Netflix told investors that these new metrics “matches how outside services measure TV viewing and gives proper credit to rewatching”.
The streaming giant says it will also release title metrics more regularly outside its earnings report. Netflix is currently enjoying the aftermath of its biggest movie series “Squid Game” which is a story of survival games being played by people who are killed after they lose”.
Here’s what Netflix had to say about its biggest hit. “Like some of our other big hits, Squid Game has also pierced the cultural zeitgeist, spawning a Saturday Night Live skit and memes/clips on TikTok with more than 42 billion views,” the company said adding that there is a spike in the demand for consumer products based on the show.
Netflix also spoke about its recent dive into the gaming sector. It told investors that although the gaming endeavour is still in an infantile stage, it has already begun testing its games in some selected countries. Netflix has announced that the games will be a part of Netflix subscriptions and will not have ads or in-app purchases. Netflix, which is a global phenomenon, promises to be a major competitor once the launch of its game happens. The initiative will see people spend more time on the platform and on the platform’s offerings. Netflix acquired its first gaming studio Night School Studio late last month. The streaming platform which planned to launch into the music streaming scene, will, however, not be doing that any time soon.
Netflix’s biggest show Squid Game is expected to be worth at least $900 billion and it is close to achieving that. The show garnered as much as 111 million views in 28 days after its launch.