Netflix gives weak Q4 forecast; shares fall
In short
Netflix said its third-quarter revenue rose 11.8% to $12.87 billion, which matched forecasts but was the slowest growth in nearly three years.
For the fourth quarter, it guided net income to $2.79 billion and EPS to 67 cents, both below analyst expectations. Investors sold the stock after the weaker outlook, but the reason was not stated.
What the reporting says
Netflix issued a weaker-than-expected fourth-quarter profit outlook, with forecast net income of $2.79 billion and EPS of 67 cents. The company also said third-quarter revenue rose 11.8% to $12.87 billion, matching Wall Street forecasts but marking the slowest pace of growth in nearly three years. The immediate market reaction was a share drop, while the source does not say what drove the softer outlook.
Why it matters
Netflix reported third-quarter revenue of $12.87 billion, up 11.8%, and guided fourth-quarter net income to $2.79 billion with EPS of 67 cents. The forecast was below analyst expectations, which helped trigger the share drop mentioned in the summary. The reporting does not say why the outlook was weaker, so the cause remains unclear. The key affected group is Netflix shareholders.