Netflix Profit Surges, Stocks Rise on Better-Than-Expected Results

Netflix (NFLX) shares soared in extended trading Tuesday after the streaming giant reported better-than-expected fourth-quarter results and lifted its 2025 revenue outlook. The company's stock jumped 14% to nearly $995 in after-hours trading, following the release of its earnings report.

Netflix reported net income of $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.

The company added 19 million net new subscribers in the fourth quarter, taking its membership tally to over 300 million. This is the last quarter Netflix will report membership and average revenue per member on a quarterly basis, as previously announced.

Netflix also announced it would raise prices on some streaming tiers between $1 and $2 per month. The company's ad-supported tiers accounted for more than 55% of sign-ups in countries where the option is offered, and memberships on its ad-supported plans grew around 30% quarter over quarter.

Looking ahead, Netflix said it expects fiscal 2025 revenue of $43.5 billion to $44.5 billion, $500 million higher than its previous estimate. The company also boosted its share repurchase program by $15 billion, bringing its total authorization to $17.1 billion.

Netflix's strong performance comes as the company continues to invest in its content library and expand its global presence. The streaming giant has been successful in attracting new subscribers and retaining existing ones through its diverse content offerings, including popular original series like "Squid Game" and live events such as the Jake Paul vs. Mike Tyson boxing match.

Netflix's success in the streaming market can be attributed to several key factors, including its content library and quality, global expansion and localization, advertising and live events, technological innovation, and pricing strategy. These factors have contributed to the company's long-term investment potential and have driven its stock price to new highs.

As Netflix continues to grow its subscriber base, diversify its content offerings, and improve its product and user experience, investors can expect the company to maintain its competitive edge in the streaming market and drive its stock price higher. With a market capitalization of over $366.80 billion, Netflix remains a strong investment opportunity for those looking to capitalize on the growth of the streaming industry.