Netflix (NFLX) has reported second-quarter financial results that beat Wall Street forecasts on the top and bottom lines due largely to a 34% increase in ad-supported memberships.
The company announced earnings per share (EPS) of $4.88 U.S. versus $4.74 U.S. that was expected among analysts who track the company’s progress.
Revenue for the April through June quarter totaled $9.56 billion U.S. compared to $9.53 billion U.S. that was the consensus expectation on Wall Street. Sales were up 17% from a year earlier.
Total memberships at Netflix rose 16.5% year-over-year to 277.65 million worldwide at the end of June. That number was better than the 274.4 million expected on Wall Street.
This earnings report marks one of the last times Netflix will provide an update on its membership figures as the company says it wants to focus on other financial metrics.
Management at Netflix said the company is benefitting from advertising revenue on its streaming platform and subscriber growth for its cheapest ad-supported tier.
The company said its ad-supported tier has been gaining traction, with subscribers accounting for more than 45% of new sign-ups.
The company has also cracked down on password sharing over the past 18 months.
In terms of guidance, Netflix said it expects full-year revenue growth of 14% to 15%, compared with previous guidance of 13% growth.
Netflix is also benefitting from the popularity of sports content and live sporting events on its platform.
The company is broadcasting a live boxing match featuring Mike Tyson this fall and is airing a live NFL football game on Christmas Day.
In addition to attracting subscribers, the live sports are also helping to boost advertising spending on the Netflix platform.
Popular scripted drama shows such as “Bridgerton” and “Baby Reindeer” also continue to attract consumers.
The stock of Netflix has risen 35% over the last 12 months to trade at $634.04 U.S. per share.
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