Streaming giant, Netflix has hit a new subscription record in the fourth quarter of 2023. The company reported 13.1 million subscribers in the December quarter, its largest-ever fourth-quarter subscriber growth, exceeding projected gains of 8.97 million. That brings the total number of subscribers to 260 million.
According to reports, this was fueled by the strong slate of shows that included the final season of the long-running royal drama “The Crown” and David Fincher’s original film, “The Killer.”
Netflix shares were up 8.3% in after-hours trading. The stock gained 65% during 2023. “It is becoming increasingly clear that Netflix has won the ‘streaming wars,'” wrote Bank of America media analyst Jessica Reif Ehrlich.
The company reported per-share earnings of $2.11, falling short of consensus estimates of $2.22 per share. Netflix said the per-share earnings were impacted by a $239 million noncash loss related to currency exchange rates.
Revenue rose to $8.8 billion, topping forecasts and the company’s guidance of $8.7 billion in the quarter.
The streaming giant said it expects healthy double-digit revenue growth for full-year 2024, as it continues to add members and invest in its advertising business. Netflix said advertising is not yet a primary driver of revenue growth, but it aims for that to change by 2025.
The company credited gains to the strength of its intellectual property, including “Squid Game: The Challenge,” a reality show based on its most-watched TV series, new original series such as “All the Light We Cannot See,” feature films like Zack Snyder’s “Rebel Moon: A Child of Fire,” and non-English-language programming, including the third season of “Lupin” from France.
The Co-CEO of Netflix, Ted Sarandos, who cited strong demand for licensed titles such as “Young Sheldon.” said the company has a “rich history” of breaking some of television’s biggest hits, including “Breaking Bad,” “The Walking Dead,” “Schitt’s Creek,” and more recently, “Suits.”
“I am thrilled that the studios are more open to licensing again, and I’m thrilled to tell them that we are open for business,” Sarandos said during Netflix’s investor livestream.
Netflix said it sees growth opportunities if it continues to improve its programming slate and makes inroads in new areas like advertising and games. While the games business is still in its early days, the company said engagement has tripled.
Chief Financial Officer at Netflix, Spencer Neumann said Netflix plans to increase spending on content, coming out of last year’s dual Hollywood strikes. He anticipates the streamer would invest as much as $17 billion this year, but added, “We want to do it in a smart, judicious, responsible way.”
