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LOS ANGELES — Netflix shares popped more than 9% after the closing bell Wednesday as the company reported a boost in subscriber growth driven by a password-sharing crackdown efforts and interest in its new ad-supported tier.
The streaming giant added 8.76 million global subscribers during the quarter, higher than 5.49 million Wall Street had expected, according to estimates from Street Account.
Here are the results:
Earnings: $3.73 vs $3.49 per share expected, according to LSEG, formerly known as RefinitivRevenue: $8.54 billion vs $8.54 billion expected, according to LSEGTotal memberships expected: 247.15 million vs. 243.88 million expected, according to Street Account
Netflix in the last week has seen a series of slashed price targets and revised forecasts from Wall Street analysts, most of whom are awaiting further clarity on the company’s growth strategy.
Company executives previously warned investors that its ad tier is still in its infancy and shareholders shouldn’t expect it to have a major impact on revenue until at least the end of the year.
Additionally, they have signaled that operating margins will grow more gradually going forward as it invests in more growth opportunities.
It’s been less than six months since Netflix instituted its password crackdown, so it’s unclear what impact that initiative has had for the company and how much executives will share.
Shares of the company slid before the earnings report Wednesday, but they’re up about 17% so far this year.