Netflix beats estimates as ad-supported memberships rise 34%

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The Netflix logo is displayed above its corporate offices on January 24, 2024 in Los Angeles, California. Netflix reported second-quarter earnings Thursday that showcased the media giant's position at the head of the streaming race as it added more global subscribers and saw strong growth in its advertising business. The streamer said its ad-supported memberships grew 34% during the period compared to the same quarter last year. Advertising has become an increasingly important business model for media companies to boost — or in some cases, achieve — profitability for streaming. Netflix's stock has been boosted in recent quarters by its push to gain subscribers on its cheaper, ad-supported tier, in addition to its crackdown on password sharing. Here's how the company performed for the period ended June 30, compared with Wall Street expectations: Earnings per share: $4.88 vs $4.74 per share expected by LSEG $4.88 vs $4.74 per share expected by LSEG Revenue: $9.56 billion vs.9.53 billion expected by LSEG $9.56 billion vs.9.53 billion expected by LSEG Total memberships: 277.65 million global paid memberships vs. 274.4 million expected, according to StreetAccount Revenue was roughly $9.6 billion, up 17% compared to the year-earlier period, driven primarily by the increase in average paid memberships. Netflix said it now expects full-year reported revenue growth of 14% to 15%, compared with previous guidance of 13% to 15%. The company reported net income of $2.15 billion, or $4.88 per share, up from $1.49 billion, or $3.29 per share, during the second quarter of 2023. Netflix's global paid memberships rose 16.5% year over year to 278 million. This marks one of the last updates Netflix will release regarding its membership numbers. Last quarter, the company warned investors it would stop providing quarterly membership numbers or average revenue per user beginning in 2025, noting the company is "focused on revenue and operating margin as our primary financial metrics — and engagement (i.e. time spent) as our best proxy for customer satisfaction."