The company reported total revenue of $4.187 billion for the quarter, slightly below internal forecasts and consensus estimates of analysts. Total paid subscribers increased by 8.8 million to reach 139.26 million worldwide, ahead of guidance by more than 1 million. U.S. subscriber levels ticked up 1.5 million to 58.5 million, in line with forecasts.
Earnings per share of 30 cents blew past consensus views of 24 cents and internal forecasts for 23 cents.
Netflix’s stock price was up fractionally during today’s regular trading session but is losing steam after hours on the revenue miss. It has run up 34% in 2018 as investors have recognized its strong run of subscriber-luring shows, including the company’s top-performing film to date, Bird Box and original series like The Haunting of Hill House.
The company took the unusual step of breaking out some viewership numbers along with its financials. Bird Box, it said, has now been viewed by some 80 million homes, while popular new series You and Sex Education have each been seen by 40 million. (You is particularly noteworthy as it is a new pass at a show that struggled in its first season on Lifetime.) Spanish original Elite racked up views by more than 20 million households.
Analysts have boosted their views on the stock lately in anticipation of the quarterly numbers, and said the subscription rate increases announced Tuesday indicated the company is in strong financial position.
In his quarterly letter to shareholders, CEO Reed Hastings emphasized that forecasting results is always a somewhat inexact science. While subscriber projections have been reasonably accurate, he wrote, “Quarter to quarter, revenue growth varies due to factors like [foreign exchange rates] and timing of price changes across different markets.”
Hastings also added a note about the competitive landscape, noting that the company’s competitive set isn’t necessarily what you might think. “We compete with (and lose to) Fortnite more often than HBO,” he wrote. “Our focus is not on Disney+, Amazon and others, but on how we can improve our experience for our members.”
The letter also argued that the company is “expanding the film market: while our films drew bigger and bigger audiences in Q4, the North American box office also set records.” Roma, the most lauded Netflix original to date, is still in theaters, Hastings noted. “People love films … at home and in theatres.”
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