Netflix Tuesday blew past Wall Street subscriber estimates in the fourth quarter, driven by a strong slate of shows that included the final season of the long-running royal drama “The Crown” and David Fincher’s original film, “The Killer.”

The company reported it added 13.1 million subscribers in the December quarter, its largest fourth-quarter subscriber growth ever, handily exceeding projected gains of 8.97 million. That brings the total number of subscribers to 260 million.

Shares rose more than 6% in after-hours trading.

Netflix reported per-share earnings of $2.11, falling short of consensus estimates of $2.22 per share. The company said the per-share earnings were impacted by a $239 million noncash loss related to currency exchange rates.

Revenue rose to $8.8 billion, topping forecasts and the company’s own guidance of $8.7 billion in the quarter.

The streaming giant said it expects healthy double-digit revenue growth for full-year 2024, as it continues to add members and invest in its advertising business. Netflix said advertising is not yet a primary driver of revenue growth, but it aims for that to change by 2025.

“It is becoming increasingly clear that Netflix has won the ‘streaming wars,'” wrote Bank of America media analyst Jessica Reif Ehrlich.

The company credited gains to the strength of its intellectual property, including “Squid Game: The Challenge,” a reality show based on its most-watched TV series, new original series, such as “All the Light We Cannot See,” feature films like Zack Snyder’s “Rebel Moon: A Child of Fire,” and non-English-language programming, including the third season of “Lupin” from France. It also cited strong demand for licensed titles.

“Looking ahead, despite last year’s strikes pushing back the launch of some titles, we have a big-bold slate for 2024,” the company said.

Antenna Research found that Netflix has the lowest monthly churn rate among streaming services, with just 2% of subscribers canceling in the month of December.

Media analyst John Hodulik predicted the company would also continue to benefit from its crackdown on password-sharing, which he forecast would drive a 5% lift to revenue in the quarter.

This crackdown will likely fuel the growth of Netflix’s advertising-supported tier, wrote Ehrlich. The company recently announced it had 23 million global active users on the version of the service with ads, up from 15 million in November.

Ehrlich said Netflix also is a beneficiary of changing market dynamics, which are forcing media companies to re-evaluate their strategy of retaining movies and television series exclusively for their own streaming services. She called this a “win-win” proposition, which allows Netflix to reduce its investment in higher-risk original production, even as these licensing deals provide other media companies with much-needed revenue.

Earlier in the day, Netflix and TKO Group Holdings announced a more than $5 billion deal to bring World Wrestling Entertainment’s “Raw” and some other programming exclusively on the streaming service.


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