Netflix Inc. beat Wall Street's EPS expectations for the third quarter, but the company's paid net member additions came in lower than expected, dragged down by slow U.S. growth.
The company added 6.8 million paid streaming video members globally during the third quarter, compared to earlier guidance of 7.00 million paid net additions. That included 500,000 net U.S. adds, or 300,000 below the company's guidance. International streaming net additions came to 6.3 million, above Netflix's earlier 6.20 million projection.
Netflix's third-quarter revenue totaled $5.25 billion, up 31.1% year over year from $4.00 billion and in line with consensus expectations. Net income was $665 million, or $1.47 per share, up from $403 million, or 89 cents per share, in the third quarter of 2018.
The S&P Global Market Intelligence consensus EPS estimate for the third quarter was $1.05 both on a GAAP and normalized basis. Netflix said its EPS benefited from a $171 million noncash unrealized gain from foreign exchange remeasurement of its euro-denominated debt.
Netflix expects fourth-quarter revenue of about $5.44 billion, driving net income of $232 million, or 51 cents per share. The company projects it will add 7.60 million global paid net streaming subscribers in the fourth quarter.
The consensus EPS estimate for the fourth quarter is 85 cents on a normalized and GAAP basis, according to S&P Global Market Intelligence.
Netflix stock was up more than 7% after the company reported earnings.