Netflix, Inc. (NASDAQ: NFLX) improved its performance during the third quarter of this year with the addition of 6.3 million new international subscribers after a very weak Q2.
In the latest earnings report released by the company, it informed that one of the reasons for the return to growth could be related to the sci-fi horror hit Stranger Things.
Netflix User Base Grows
In a letter to shareholders, Netflix informed that 64 million member households watched Stranger Things 3 in the first four weeks since it was added to the platform. This is one of the main reasons why the company was able to add over 520,000 subscribers in the United States and 6.2 million around the world.
In the first quarter of this year, Netflix added almost 8 million new international subscribers. Meanwhile, the U.S. market is steadily falling with fewer additions each month. Indeed, the domestic subscriber base shrank for the first time since 2011.
This comes at a moment in which Disney+, HB Max and Apple+ are entering the streaming market. At the moment, Netflix has 158.3 million paid subscribers and 97.7 of them are international while 60.6 million are from the United States.
During the last years, international subscribers have been very important for the company that is currently expanding the number of clients in different regions around the world. As mentioned before, the growth in the U.S. market is decelerating.
There is also a small number of users that are currently using the free trial and that could eventually become paid subscribers in the coming quarters.
Despite these good new subscriber numbers for the third quarter of this year, the company’s shares fell 6.15% in the last 24 hours. At the time of writing, Netflix has a share price of $275.3, falling $18.05.
A few days ago, LearnBonds reported Netflix generated third-quarter revenue of $5.25 billion. This represents a growth of 31% from the past year period.
Although data from the United States suggests individuals could be moving to other new streaming services, the strong growth Netflix had abroad could help the company remain competitive. At the same time, it will take some time for Netflix’s market share to drastically fall.
According to a recent report released by Digital TV Research, the global over-the-top (OTT) market is expected to reach $159 billion in 2024. Netflix and other companies will have to offer better services for users to be able to meet this growing demand.