The streaming giant Netflix found its way back to user growth in the third quarter thanks to successful series such as "Stranger Things" and "Dahmer: Monster". In the quarter to the end of September, the company booked a total of 2.4 million new paid subscriptions, as announced on Tuesday after the US stock market closed.
Netflix thus achieved customer growth of 4.5 percent year-on-year and significantly exceeded both its own forecast of around one million new users and that of the financial market. The stock jumped more than 14 percent in after-hours trading.
"Thank God we're past the quarters of decline," said Netflix CEO Reed Hastings, referring to the decline in subscribers in the first half of the year. "We believe we are on our way to accelerating growth again," the letter to shareholders said.
At the end of the quarter, Netflix had a total of over 223 million user accounts worldwide. The company expects another 4.5 million new customers by the turn of the year.
At the end of the year, the company has high hopes for the fifth season of its hit series "The Crown" about the British Royal Family. In order to hold its own in the face of fierce competition, Netflix spends a lot of money on production and marketing. Net profit fell in the most recent quarter compared to the same period last year by around 3.5 percent to 1.40 billion dollars (1.42 billion euros). In the current quarter only a result of 163 million dollars is expected.
At least the investments seem to be paying off. Not only the number of users and the business outlook surprised positively, Netflix also exceeded market expectations in terms of sales with growth of 6 percent to 7.9 billion dollars. For the current quarter, however, the company expects a slight decline in revenues. The only reason, however, is the strong US dollar, which reduces foreign earnings after conversion into US currency.
In the annual report, Netflix also made an unusual dig at its rivals, who sometimes accept deep red numbers when chasing market share in the streaming business: "We estimate that they are all losing money." Overall, the assembled competition is likely to incur operating losses of well over $10 billion in 2022, while Netflix expects an operating profit of $5 billion to $6 billion for itself.
"Our competitors are investing heavily to fuel their subscriber growth and engagement, but building a large and successful streaming business is tough," said the longtime market leader. But Netflix has enough of its own construction sites. In order to really push growth again, the company is launching a cheaper subscription with advertising in November. In addition, decisive action is to be taken in the coming year against the unauthorized multiple use of customer accounts by sharing passwords.