What is the reason why Netflix announced its financial results for the third quarter of 2020 and recorded an increase in profits despite a low number of new subscribers?
Netflix announced its financial results for the third quarter of 2020 (July-September) on October 20, 2020. Revenues have been growing steadily compared to the same period of the previous year, but the number of paying members, which had been increasing rapidly due to the influence of the new coronavirus, has been sluggish.
FINAL-Q3-20-Shareholder-Letter
(PDF file)
Netflix misses Q3 subscriber forecast in mixed earnings report --LA Biz
https://www.bizjournals.com/losangeles/news/2020/10/20/netflix-falls-short-q3-subscriber-forecast.html
In the table below Netflix has released, the financial results for the third quarter of 2020 are shown in gray. Revenue was about $ 6,436 million, a 23% year-on-year growth. Of this, operating income is approximately $ 1.315 billion (approximately ¥ 138.5 billion), net income is approximately $ 790 million (approximately ¥ 83.2 billion), and the operating income margin is approximately 20.4%.
Netflix gained 6.8 million members in the year-ago quarter, compared to a sluggish growth of 2.2 million in the third quarter of 2020. In addition, Netflix expects that the increase in membership due to the increase in the number of people refraining from going out due to the new coronavirus seen from
Below is a graph showing the changes in the number of Netflix members by year, with the vertical axis showing the increased number of members and the horizontal axis showing the month. Forecasts of future membership trends are shown by dotted lines, with Netflix commenting, 'We will increase the number of members worldwide by another 6 million by the fourth quarter.'
In addition, according to Netflix, in the third quarter, the number of members increased by about 180,000 in North America, about 260,000 in Latin America, and about 760,000 in Europe, the Middle East, and Africa. The Asia-Pacific region had the highest number of new members in the third quarter, recording an increase of approximately 1 million. While the number of new subscribers worldwide is sluggish, the result is that the Asia-Pacific region alone accounts for about half of the number of new subscribers in the world.
Netflix said, 'We are pleased that our content has made progress in the Asia-Pacific region, especially in both Japan and South Korea. This is encouraging, but we still have to do it. There are many things and we are working hard to recreate this success in India and other countries. '
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