Netflix shares soared in US premarket trading on Wednesday after the company reported a blockbuster holiday quarter as a robust content line-up and its entry into live sports streaming brought in a record number of new subscribers.
The streaming giant's stock surged over 14 per cent to $994.36, poised to boost its market capitalization by $53 billion to about $425 billion, if gains hold.
The year 2024 was pivotal for Netflix as it ventured into live sports. It partnered with WWE, broadcast two NFL games on Christmas Day, and secured US broadcast rights for the 2027 and 2031 FIFA Women's World Cups.
"Netflix is simply running away with the streaming market thanks to excellent execution, a stellar content slate, and scale advantages," said Evercore ISI analysts in a note.
The company added 18.9 million subscribers in its holiday quarter, blowing past Wall Street's estimate of 9.2 million additions for the quarter and the 13.1 million increase it posted a year ago, according to LSEG data.
Its fourth-quarter revenue and profit also beat estimates, as Netflix's efforts to shift investor focus away from subscription growth to other performance metrics paid off.
Netflix's deepening investment in live-streamed events is drawing tens of millions of viewers. Morgan Stanley said Netflix's "unmatched scale creates the financial capacity to invest back into the business".
At least nine analysts raised their price targets on the stock following the company's quarterly results, bringing the median target to $970 from $922.50, according to data compiled by LSEG.
The stock's 12-month forward price-to-earnings ratio stands at 35.43 compared with Walt Disney's 19.19.
Netflix also announced price hikes for most of its plans in the United States, Canada, Portugal and Argentina.
"Heading into a robust 2025 slate, we expect little pushback to price increases in the US and a few other markets," JP Morgan analysts said.
In 2024, Netflix's stock soared about 83 per cent, Disney's climbed 23 per cent, while Warner Bros Discovery saw a decline of about 7 per cent.
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