Streaming video service Netflix added more than five million paid subscribers during its third fiscal quarter (Q3) of the year, the company revealed on Thursday.
The number of global subscribers paying for Netflix rose to 282.72 million, a 2 percent increase compared to Q2 and representing more than 14 percent growth on a year-over basis.
Revenue clocked in at $9.825 billion for the quarter, fueled by an increase in paid subscribers and growth in the company’s advertising business. The figure was 15 percent higher compared to Q3 2023.
Related: Netflix grows by 8 million subscribers during Q2 2024
Those data points exceeded Wall Street expectations, which counted on Netflix earning $9.77 billion in revenue and growing its subscriber count to 282.15 million during Q3.
Shares of Netflix closed at $687 on Thursday. In after-hours trading, Netflix’s stock price increased 5 percent to $718.88 immediately after the company disclosed its earnings.
Netflix is working to reorient its earnings reports away from data focused on subscribers — it will soon stop disclosing subscriber growth figures — in favor of engagement, which it views as a better metric of its business health.
To that end, executives said “engagement, our best proxy for member happiness, remains healthy.”
“Through the first three quarters of 2024, view hours per member amongst owner households — the clearest view of engagement trends post the introduction of paid sharing — increased year over year,” executives affirmed in a letter to shareholders.
Netflix said its revenue in the U.S. and Canada grew 16 percent on a year-over basis, driven by a 10 percent increase in average paid memberships, among other factors. In Europe, the Middle East and Africa, revenue there also grew 16 percent on a year-over basis, while in Latin America, revenue increased 9 percent.
For Q4 2024, Netflix is forecasting 15 percent overall revenue growth and paid net additions to be “higher in Q4 than in Q3…due to normal seasonality and a strong content slate.” Among other things, Netflix is set to offer two National Football League (NFL) games on Christmas Day, which will fall within its Q4 earnings period.
