On January 21, Netflix announced its Q4 earnings report exceeding the expectations of Wall Street, followed by a stock gain of 14%. Netflix saw drastic user growth as it surpassed 300 million paid subscribers in the fourth quarter of 2024. In the fourth quarter, the streaming platform added a record 19 million paid subscribers. Netflix said that user growth was fueled by its strong content lineup, better product features, and the usual boost from the fourth quarter.
Ted Sarandos, Netflix Co-CEO said, “We really have built the business on variety and quality across countries, across regions, across genres and really focused year-round on having a very strong slate of programming for our members.”
Netflix Q4 Earnings Report
On Tuesday, Netflix released its Q4 earnings report outperforming the expectations of Wall Street Analysts. As per reports, the company surpassed the count of 300 million paid subscribers. Netflix also revealed that, including “extra member accounts,” their global audience is estimated to surpass 700 million.
Net income for the quarter was $1.87 billion, or $4.27 per share, compared to $938 million, or $2.11 per share, from the same period last year. Fourth-quarter revenue grew 16% year-over-year, hitting $10.25 billion, surpassing Wall Street’s prediction of $10.11 billion.
Netflix’s 2025 Earnings Outlook
For 2025, Netflix has increased its earnings forecast to a range of $43.5 billion to $44.5 billion. The company made an around $500 million higher forecast than the previous one, which reflects high-performance potential and improved business strategies as showcased by powerful fourth-quarter earnings.
From the first quarter of 2025, Netflix will not report quarterly paid subscriber counts. As announced previously, the company will only report bi-annual engagement reports along with the second and fourth-quarter reports respectively.
Netflix Business Strategies for 2025
In 2025, the company plans to grow its core business with more series and films, improve customer experience, and focus on its advertisement business. The streaming platform is expected to delve more into live shows and events. Netflix’s lower-cost, ad-supported plans made up over 55% of sign-ups in countries where they’re available. The company also reported a 30% growth in memberships for these plans compared to the previous quarter.
“We’re on track to reach a strong number of ad-supported members in all our ad markets by 2025,” the company said. “A key focus for 2025 is enhancing our offerings for advertisers to significantly boost our ad revenue.”
What’s Next for Netflix Subscribers?
In 2025, Netflix will bring back two of its biggest hits, “Stranger Things” and “Wednesday.” The streamer will also release new films featuring top stars and directors, including Daniel Craig and Rian Johnson’s third “Knives Out” film, “The Electric State” with Millie Bobby Brown, “Happy Gilmore 2” with Adam Sandler, and Guillermo del Toro’s take on Frankenstein.
Netflix to Raise Subscription Price
To capitalize on its growing popularity, Netflix raised prices in the U.S., Canada, Portugal, and Argentina to fund more programming. In the U.S., the ad-supported plan will now cost $7.99 a month, up from $6.99, while the premium plan will rise to $24.99, a 9% increase.
Netflix Stock Update
Investors were excited by the results, causing Netflix’s stock to jump nearly 13% in after-hours trading, adding almost $50 billion to its market value. Over the past year, Netflix shares have risen more than 77%, outperforming the S&P 500’s 24% increase.
