Netflix subscribers soar past 200 million member milestone

90 0

Netflix’s subscribers surpassed 200 million as it closed out 2020, a milestone further cementing Netflix as the world’s biggest subscription streaming service of its kind.

By comparison, Disney Plus — which has been the breakout hit in the parade of new streaming service rivals to Netflix in the last year and a half — has ramped up to 86.8 million subscribers. Disney’s Hulu service, which has been streaming as long as Netflix but operates only in the US, has 38.8 million subscribers.

Netflix said subscribers increased by 8.51 million between October and December to hit 203.66 million total, according to its Tuesday report for fourth-quarter results. That beats Netflix’s October guidance to add 6 million new members. Analysts on average expected about 6.1 million member additions, according to Thomson Reuters.

Shares jumped 11% percent to $558 in after-hours trading.

The increase comes after Netflix’s growth slowed to a crawl in the previous quarter, when it added fewer new members than expected after a surge in popularity in the first half of the year as many households came to grips with entertaining themselves more at home. Netflix added more new subscribers in the first three months of the year, for example, than it ever had before, record growth that was taken as a bellwether for the popularity of streaming video during the coronavirus pandemic.

Netflix, with the eye-popping size of its original-programming pipeline and its stream-at-home model, was ideally positioned to keep serving up new shows and movies to people stuck at home and desperate for entertainment. But even Netflix warned that its popularity early in the year was likely pulling forward demand that it would have typically expected to materialize later.

But Netflix had already shown signs that its growth was chugging along during the latest period. In October, it ended its long-standing practice of offering month-long free trials to new subscribers. And later that month, Netflix raised prices in the US for both its most popular, standard plan and its higher-end premium plan. The price bump, likely unwelcome by some subscribers, was widely anticipated by investors and analysts to come sometime in 2020 or possibly 2021. But the fact that it came earlier rather than later suggested Netflix was confident enough in its growth trends to start charging members more in spite of a myriad of new rivals.

In the US and Canada, its biggest single region, Netflix added 860,000 new streaming customers, for a total of 73.9 million. In Europe, Middle East and Africa, subscribers grew by 4.46 million to 66.7 million. In Latin America, subscribers increased 1.2 million to 37.54 million. And in the Asia Pacific region, Netflix booked 2 million new members to hit 25.5 million.

Looking ahead to the first quarter, Netflix expects to add 6 million streaming members globally. Analysts’ consensus estimate was for Netflix to predict about 8 million. Netflix also predicted $2.97 per share in earnings in the first quarter. On average, Wall Street analysts who track Netflix expected $2.07.

Overall in the fourth quarter, Netflix reported a profit of $542.2 million, or $1.19 a share, compared with $587 million, or $1.30 a share, a year earlier. Revenue climbed 22% to $6.64 billion.

Analysts on average expected per-share profit of $1.39 — compared with Netflix’s guidance for $1.35 — and $6.1 billion in revenue.

Related Post

Leave a comment

Your email address will not be published. Required fields are marked *