Netflix beats expectation and smashes 200MN subs mark in 2020 | Major Businesses | Business | News | Rapid TV News
By continuing to use this site you consent to the use of cookies on your device as described in our privacy policy unless you have disabled them. You can change your cookie settings at any time but parts of our site will not function correctly without them. [Close]
In what it said was an incredibly difficult year with great uncertainty, SVOD leader Netflix has reported a hugely successful 2020 calendar year with the 8.51 million paid net additions in the fourth quarter, significantly more than expected, taking the yearly total to 203.66 million global paid memberships.
Netflix office LA 20 Jan 2021
Q4 20 subs growth was 21.9% on an annual basis and in addition to seeing the company breaking the 200 million paid memberships mark, the company added for the full year a record 37 million paid memberships, the total showing an annual growth of 31%. As many as 83% of Netflix’s paid net adds in 2020 were sourced from outside the company’s core United States and Canadian area (UCAN) while the EMEA region accounted for 41% of full year paid net adds, while APAC was the second largest contributor to paid net additions with 9.3 million, up 65% year over year.

Such a performance was way beyond that predicted in the Q3 results which projected 6.0 million paid net additions for Q4 20, 2.2 million fewer net adds than for the same period in 2019.

The surge in memberships was a driver for total yearly revenues of $24.996 billion, growing 24% on a year-on-year basis. Operating profit grew 76% annually to $4.6 billion. For the fourth quarter, Netflix generated $6.644 billion, growing 21.5% annually, and deliver quarterly operating income of $954 million, an operating margin of 14.4%.

Attributing reasons for the better than expected quarterly and yearly performance which has impressed Wall Street analysts, Netflix cited its original content slate and said that it had prospered despite the arrival of significant competitors, identifying Disney as a key rival, calling out the 87.7 million sign-ups for Disney+ since launch in November 2019. Netflix noted that such competition explained in part why it had been moving quickly to grow and further strengthen the original content library across a range of genres and nations. It added that its fourth quarter slate highlighted the breadth and diversity of its entertainment offering and stressed that it would continue to ramp up its local original content slate.

Going forward, as it announced its fourth quarter results, Netflix gave guidance for Q1 21 of 6.0 million paid net additions with $7.129 billion in revenue for the quarter. Whilst the former would be significantly down on the quarter a year ago, which saw a spike in subs through the first Covid-19 lockdowns, the revenue growth would represent a 23.6% annual lift.