Netflix shares were sharply higher in premarket trade early Thursday, after the streaming platform beat Wall Street estimates in its third-quarter results.
The stock was up 13.8% at 5:24 a.m. ET.
The company reported net subscriber growth of 8.8 million, well ahead of expectations and marking the biggest quarterly growth since the second quarter of 2020. The firm also said it expected an operating margin of 20% for the full-year 2023, at the top end of the company’s prior guidance.
During the quarter, Netflix cracked down on password sharing, now liming the use of an account to one household. The tech firm also added a new subscription option that allows users to pay less if they view advertisements before and during films and shows.
The results posted after-hours Wednesday also surprised analysts with a forecast for similar subscriber growth in the next quarter, plus or minus “a few million.”
Third-quarter revenue came in at $8.542 billion, representing year-on-year growth of 7.8%. Net income rose to $1.677 billion from $1.398 billion the prior year.
Netflix shares have gained nearly 30% over the last year, but have cooled from their 2021 levels amid growth concerns as the platform faces a rising number of rivals in the streaming space, CNBC reports.
