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Netflix Beats, Up 7%; IBM Mixed, Down 2.7%

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Netflix (NFLX - Free Report) has outperformed earnings expectations for Q3 after the bell today, posting $1.47 per share versus $1.05 in the Zacks consensus (which was itself +18% year over year). Revenues came in a smidge light at $5.244 billion, in-line basically but officially down from the $5.25 billion anticipated. Shares are up big — over 7% — in immediate after-market trading.


Subscriber adds were disappointing on the U.S. side — 517K new streaming subscribers in the quarter missed the 0.8 million estimate — though at least this was a positive number, as opposed to the previous quarter which showed negative subscriber adds. Guidance for subscribers in Q4, when we expect Disney+ and Apple TV+ to come on market as well, also disappointed: 7.6 million streaming net adds are expected, down from the estimated 9.5 million.


International net adds made up the difference: 6.255 million outperformed the 6.05 million analysts were anticipating. This shows Netflix’s long-term goals of expanding its market globally is bearing fruit, even if domestic challenges look to provide headwinds going forward. 


IBM Corp. (IBM - Free Report) posted mixed results in its Q3 report this afternoon, beating on the bottom line — $2.68 per share versus $2.64 expected — but missing on the top: $18.08 billion, down from the Zacks consensus $18.24 billion. This is the fifth straight quarter of shrinking sales revenue for the tech giant, as it continues to re-focus its platforms. A 2% gain in cloud revenue is decent, but not good enough to keep the stock from selling off 2.7% in the after-market.


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