Netflix is firmly on the run for new subscribers in the 3rd quarter. The world leader in streaming video announced Wednesday night that 6.77 million new paid subscribers joined its services during the 3 months ended in September, bringing the total number of subscribers to more than 158 million.
The Q3 figures are slightly higher than the 6.7 million expected by the consensus of Factset, and 2.4 times higher than the number of new paying subscribers in the second quarter (2.8 million) when the group had strongly disappointed. However, Netflix itself had forecast a slightly higher number of new subscribers, at 7 million.
On Wall Street, the Netflix stock has welcomed this news with a jump of more than 8% Wednesday in the after-hour trading.
Subscriber growth comes mainly from the international market. In the United States, only 500,000 new subscribers were registered, which is an improvement over the second quarter, when the group lost subscribers in its home country for the first time in seven years.
The company’s earnings per share amounted to $1.47 (compared with $0.89 a year earlier) for a turnover of $5.25 billion, up 34% compared to the $3.91 billion in the 3rd quarter of 2018. The Factset consensus was based on a much lower EPS of $1.03, and sales of $5.25 billion.
These figures are likely to reassure the markets, after the big disappointment that followed its accounts of the 2nd quarter, and caused a fall of more than 20% of the Netflix share. Analysts fear that the group will suffer from increased competition, including the arrival of streaming video services from Apple and Walt Disney next November.
The company is now looking for an addition of a total of 7.6 million global subscribers in the final three months of the year, well shy of current consensus for 9.23 million. And expectations for fourth-quarter EPS of 51 cents with $5.44 billion in sales are short of expectations.
“Really what we’re just trying to do there is be prudent,” CFO Spencer Neumann said during the company’s earnings interview Wednesday. “There’s a number of moving parts in Q4 and variables that are just difficult to forecast.”