Netflix Revenues Rise 17 Percent in Q3

Netflix’s third-quarter revenues hit $11.5 billion, a 17 percent increase on the year-ago period, delivering a net profit of $2.5 billion.

The year-over-year revenue growth for the third quarter is attributed to membership growth, pricing adjustments and increased ad revenue.

Revenues in the U.S. and Canada rose 17 percent year-over-year to $5 billion. The EMEA region delivered $3.7 billion in revenues, a year-over-year increase of 18 percent. Latin America saw slower growth, with revenues rising 10 percent year-over-year to $1.4 billion. AsiaPac revenues increased 21 percent year-over-year to $1.4 billion.

The third-quarter operating margin was below Netflix’s forecast of 31.5 percent, landing at 28 percent. This is attributed to an ongoing dispute with Brazilian tax authorities that was not in the forecast. “We don’t expect this matter to have a material impact on future results,” Netflix said in its letter to shareholders.

A diverse selection of new and returning series—such as Wednesday, My Life with the Walter Boys and Alice in Borderland—and films helped drive record TV viewing share in the third quarter in the U.S. and the U.K.

“At Netflix, our goal is both simple and ambitious: to entertain the world,” the platform said. “We achieve this by offering a diverse selection of series, films and games that our members love. This in turn fuels engagement, and when people love what they watch and play, they stick around longer, recommend Netflix to others and place a higher value on our service.”

Netflix plans to continue growing its advertising business to keep driving revenue growth.

“We’ve come a long way in building our advertising business in less than three years,” the platform noted. “In that time, we’ve gone from zero members on our ad plans to achieving sufficient scale in all 12 of our ads markets—and we’ll continue to grow from here—building out our ad sales and operations teams and enhancing capabilities for advertisers, including launch our own first-party ad tech stack. We have a solid foundation and are increasingly confident in the outlook for our ads business. We are now on track to more than double our ads revenue in 2025.”

In Q4, Netflix expects revenue growth of 17 percent, driven, like the Q3 results, by growth in members, pricing and ad revenue.