Netflix reported a record quarter on Tuesday that beat Wall Street expectations and sent its shares higher in trading. The company added a whopping 13.1 million paid subscribers during the fourth quarter and solidified its position as the world's leading streaming service.
This explosive growth, which significantly exceeds the 8.76 million added in the previous quarter, paints a picture of Netflix's growing popularity. The company's aggressive advertising push, along with its crackdown on password sharing, appears to be reaping rewards, fueling a surge in new members.
Netflix is a company that has been making steady progress for years, there have been few months of stagnation. In addition to the headline subscriber figures, Netflix also beat expectations in terms of revenue and earnings.
Revenues of $8.83 billion and earnings per share of $2.11 demonstrated the company's strong financial strength. Buoyed by its stellar performance, Netflix is raising its bets. The company revised its full-year 2024 operating margin forecast to 24%, citing favorable currency fluctuations and an outperformance in the fourth quarter.
Additionally, it is forecasting Q1 2024 earnings per share of $4.49, beating analysts' expectations of $4.10.
Netflix also announced increased spending on content, promising more shows and blockbuster movies for subscribers.
However, unlike some competitors seeking refuge in consolidation, Netflix remains committed to itself. In a letter to shareholders, the company explicitly ruled out buying traditional media companies or linear assets, stating: "As our competitors adapt to these changes, it is logical to expect further consolidation, especially among companies with large linear networks that are in decline.
We are not interested in acquiring linear assets. We also do not believe that further mergers and acquisitions among traditional entertainment companies will significantly change competitive landscape given all the consolidation that has already taken place over the past decade.
" This statement shows Netflix's confidence in its own strength and its potential for future growth. Netflix is already a leader, and the company aims to strengthen its leadership position in the coming years with a very effective strategy.