{"id":32210,"date":"2023-10-20T01:55:45","date_gmt":"2023-10-20T01:55:45","guid":{"rendered":"https:\/\/innodebt.com\/investing\/netflixs-stock-jumps-more-than-10-on-huge-spike-in-subscribers-price-hikes\/"},"modified":"2023-10-20T01:55:47","modified_gmt":"2023-10-20T01:55:47","slug":"netflixs-stock-jumps-more-than-10-on-huge-spike-in-subscribers-price-hikes","status":"publish","type":"post","link":"https:\/\/innodebt.com\/?p=32210","title":{"rendered":"Netflix\u2019s stock jumps more than 10% on huge spike in subscribers, price hikes"},"content":{"rendered":"
\n

Netflix Inc.\u2019s stock spiked Wednesday on a huge jump in subscribers, earnings that met expectations and an announced price hike in the company\u2019s basic and premium services.<\/p>\n

Netflix said it plans to immediately raise prices for its basic plan in the U.S. to $11.99 a month from $9.99, and lift its premium price to $22.99 a month from $19.99. The ad-supported ($6.99 a month) and standard plans ($15.49) remain the same.<\/p>\n

\n

Read more: <\/strong>Netflix is raising prices on some plans. Here\u2019s what you need to know.<\/strong><\/p>\n

Netflix
\n NFLX,
\n +16.05%<\/bg-quote>
\n reported that subscribers increased by a whopping 8.76 million in the third quarter of the year, blowing past analysts\u2019 average estimate of about 6 million. Netflix reported fiscal third-quarter net earnings of $1.7 billion, or $3.73 a share, compared with $3.10 a share in the year-ago quarter.<\/p>\n

Revenue improved to $8.54 billion from $7.9 billion a year ago. Analysts surveyed by FactSet had expected on average net earnings of $3.49 a share on revenue of $8.54 billion.<\/p>\n

For the fourth quarter, Netflix executives guided for earnings of $2.15 a share on $8.7 billion in revenue, while analysts on average were expecting earnings of $2.16 a share on sales of $8.8 billion.<\/p>\n

Netflix executives also weighed in on the progress of its ad-supported platform. \u201cWhile we have much work to do to build out this business, we\u2019re making good progress and laying the foundation for what we believe should be a multibillion-dollar revenue stream over time,\u201d Netflix executives wrote in a letter to shareholders.<\/p>\n

Ad-tier subscriptions skyrocketed nearly 70% in the third quarter from a year ago, and now account for 30% of new sign-ups in a dozen countries, according to the executives.<\/p>\n

The company said its crackdown on password sharing had led to fewer cancellations than it had expected, and that content spending this year will be about $13 billion despite two Hollywood strikes.<\/p>\n

\u201cWe\u2019re going to continue the rollout [of paid sharing] for the next several quarters \u2026 that we want to win over,\u201d Netflix Co-Chief Executive Greg Peters said in a videoconference call discussing the results.<\/p>\n

Shares surged nearly 13% in after-hours trading following the release of the results, after closing the regular session with a 3% decline. Early Thursday, Netflix\u2019s stock jumped 15% \u2014 the largest percentage increase since Jan. 20, 2021, when it climbed 16.85%.<\/p>\n

Netflix\u2019s stock has advanced 17% so far this year but has stumbled in the past few months, while the broader S&P 500 index
\n SPX
\n is up 12% year to date.<\/p>\n

Rumors around another price hike had been swirling for more than a week, and some analysts see Netflix more strongly pursuing a traditional media strategy of advertising-supported tiers to maximize revenue. The thinking is that many consumers will opt out of pricey, ad-free premium services for a cheaper, ad-supported model.<\/p>\n

\u201cSubscriber growth is big, but what is more important is average revenue per user,\u201d said Jon Christian, executive vice president of Qvest U.S.,\u00a0a streaming technology provider, said in an interview. \u201cFor me, how well is the ad-tier working?\u201d<\/p>\n

The prospect of consumers paying for a service that is also supported by ads harkens to the traditional TV-revenue model, Christian said, as Netflix continues to lead a market it helped create but now faces intensifying pressure from Walt Disney Co.
\n DIS,
\n -1.69%<\/bg-quote>,<\/span>
\n Apple Inc.
\n AAPL,
\n -0.22%<\/bg-quote>,<\/span>
\n Amazon.com Inc.
\n AMZN,
\n +0.21%<\/bg-quote>,<\/span>
\n Paramount Global
\n PARA,
\n -3.36%<\/bg-quote>,<\/span>
\n Comcast Corp.
\n CMCSA,
\n -2.16%<\/bg-quote>,<\/span>
\n and others.<\/p>\n

\u201cWe expect \u201924 and beyond to be more of a mix between membership and [average revenue per member],\u201d Netflix Chief Financial Officer Spencer Neumann said in the video chat late Wednesday.<\/p>\n

With its stunning addition of subscribers, Netflix now boasts 247.15 million worldwide.<\/p>\n

Co-CEO Ted Sarandos at one point credited the success on third-party content licensed by Netflix, led by the old USA Network legal drama-comedy, \u201cSuits.\u201d He said Nielsen deemed it the No. 1 streaming series for 13 straight weeks.<\/p>\n

Read more: \u2018Suits\u2019 is Netflix\u2019s unlikely new smash hit \u2014 and may also point to its future<\/strong><\/p>\n

Sarandos underscored Netflix\u2019s commitment to sports, but not live events. Instead, its strategy focuses on sports documentaries and the stories behind high-profile athletes like David Beckham.<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Netflix Inc.\u2019s stock spiked Wednesday on a huge jump in subscribers, earnings that met expectations and an announced price hike in the company\u2019s basic and premium services. Netflix said it plans to immediately raise prices for its basic plan in the U.S. to $11.99 a month from $9.99, and lift its premium price to $22.99 […]<\/p>\n","protected":false},"author":1,"featured_media":32211,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[32],"tags":[],"class_list":{"0":"post-32210","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-investing"},"yoast_head":"\nNetflix\u2019s stock jumps more than 10% on huge spike in subscribers, price hikes | Innodebt<\/title>\n<meta name=\"description\" content=\"Netflix Inc.\u2019s stock spiked Wednesday on a huge jump in subscribers, earnings that met expectations and an announced price hike in the company\u2019s basic and\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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