Netflix shares hit record highs — what is the reason
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Netflix shares surged 13% to an all-time high on Wednesday, January 22, after the company said it added a record 18.9 million subscribers in the fourth quarter of 2024. The significant growth was made possible by focusing on sports broadcasts as well as price increases in key regions, including the United States.
Reuters reports.
How the company's financial position has changed?
Currently, Netflix has 301.6 million global subscribers, far outpacing its competitors in the streaming industry. As a result, the company has more opportunities to expand its advertising business and secure lucrative deals with advertisers.
If the positive momentum persists, Netflix's market capitalization could surpass $400 billion, adding approximately $50 billion to its current valuation of $370 billion. On Wednesday morning, the company's stock reached a record high of $988 per share. This growth follows a successful 2024, during which the share price increased by an impressive 83%.
Despite the increase in subscribers, revenue growth was only 16%, exceeding expectations by $100 million. This was due to the growth of the user base in low-income regions and the popularity of ad-supported plans.
Netflix made a successful debut in sports broadcasting, including a boxing match between Jake Paul and Mike Tyson. The event became the most-watched in the company's history. The platform also attracted millions of viewers with broadcasts of National Football League games and Beyoncé's popular Christmas performance.
Experts believe the company will continue to expand its presence in sports. Netflix has already secured the rights to broadcast the FIFA Women's World Cup in the United States in 2027 and 2031.
As a reminder, the shares of some European car manufacturers fell as Donald Trump announced new tariffs.
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