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Shares of Netflix soared more than 14% Tuesday after the company posted fourth-quarter results that beat on the top and bottom lines.
The company surpassed 300 million paid memberships during the quarter, adding a record 19 million subscribers. Netflix said the growth was driven by its content slate, improved product and typical fourth-quarter seasonality.
The company also shared that including “extra member accounts,” its global audience is estimated to be exceed 700 million.
“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 co-CEO Ted Sarandos said during an investor call.
Here’s how Netflix performed for its most recent quarter, ended Dec. 31, compared with Wall Street estimates:
- Earnings per share: $4.27 vs. $4.20, according to LSEG
- Revenue: $10.25 billion vs. $10.11 billion, according to LSEG
- Paid memberships: 301.63 million vs. 290.9 million, according to StreetAccount
Net income for the period was $1.87 billion, or $4.27 per share, up from $938 million, or $2.11 per share, during the same quarter a year earlier.
Revenue in the fourth quarter jumped 16% year-over-year, reaching $10.25 billion, higher than the $10.11 billion Wall Street had predicted.
For the full year 2025, Netflix raised its revenue expectations to a range of $43.5 billion to $44.5 billion, around $500 million higher than its previous forecast to reflects improved business fundamentals and the expected carryover benefit of its stronger-than-expected fourth quarter performance.
The fourth quarter was the last for which Netflix will report quarterly paid subscriber counts, as previously announced. Instead, it will start reporting a bi-annual “engagement report” alongside its second- and fourth-quarter releases.
The streamer on Tuesday touted the success of its fourth-quarter slate, which included the release of season 2 of the hit series “Squid Game” as well as live sporting events like the record-breaking Jake Paul and Mike Tyson boxing match and National Football League games on Christmas Day.
“We are thrilled that some folks came in for the fight and some folks came in for the games, but they stuck around for ‘Squid Game’ and for ‘Carry On’ and for ‘Black Doves’ and for ‘Six Triple Eight’ … Nate Bargatze’s new comedy special,” Sarandos said. “All those things performed really well in the quarter and continue to in the days and weeks after the fight and after the games.
“And what’s really been most encouraging is the retention behavior of those folks who did come in for those events look a lot like the folks who come in for all of our other big titles,” he said.
This year, the company said it plans to improve its core business with more series and films, enhance its product experience and continue to grow its ads business. Netflix is expected to delve further into the live event space and games, as well.
The company also has the return of “Strangers Things” and “Wednesday,” two of its biggest hits, ahead for 2025. Additionally, the streamer will release a collection of new films from top directors and actors including Daniel Craig and Rian Johnson’s third “Knives Out” film, a Russo Brothers project called “The Electric State” starring Millie Bobby Brown, “Happy Gilmore 2” with Adam Sandler and a new take on Frankenstein from Guillermo del Toro.
“We’re fortunate that we don’t have distractions like managing declining linear networks and, with our focus and continued investment, we have good and improving product/market fit around the world,” the company said in its earnings report Tuesday.
Netflix also announced it would raise prices on some streaming tiers between $1 and $2 per month.
Netflix’s cheaper, ad-supported tiers accounted for more than 55% of sign-ups in countries where the option is offered, the company said. Netflix also noted that memberships on its ad-supported plans grew around 30% quarter-over-quarter.
“We’re on track to reach sufficient scale for ads members in all of our ads countries in 2025,” the company said. “A top priority in 2025 is to improve our offering for advertisers so that we can substantially grow our advertising.”