Netflix misses earnings estimates in Q4

Netflix Inc (NASDAQ: NFLX) is trending up in extended hours on Tuesday after reporting better-than-expected revenue for its fiscal fourth quarter.

Netflix reports strong subscriber growth

Investors are cheering also because the streaming giant came in above Street estimates for net new subscribers.

Netflix ended its recent quarter with 260.8 million subscribers versus 256 million expected. The streaming giant said in its letter to shareholders today:

Netflix stock is now up more than 45% versus its low in mid-October.

Netflix issues upbeat guidance

$NFLX is being rewarded also because the management issued upbeat guidance on Tuesday. The mass media behemoth is now calling for a 16% growth in revenue in its fiscal Q1 on better subscriber growth than the same quarter last year.

Note that Netflix is currently in the midst of a crackdown on password sharing and creating ads as a new source of revenue. Its letter to shareholders also reads:

Wall Street currently has a consensus “overweight” rating on Netflix stock.

Netflix Q4 earnings snapshot

• Earned $938 million versus the year-ago $55 million
• Per-share earnings also climbed from 12 cents to $2.11
• Revenue jumped 12.5% year-over-year to $8.83 billion
• Consensus was $2.22 a share on $8.71 billion in revenue

On Tuesday, Netflix also said it will start to stream WWE Raw from 2025 (find out more).