Netflix shares jump 7% in premarket after third-quarter earnings beat

Netflix shares jumped Friday after the media streaming giant reported third-quarter earnings and revenue that beat expectations.

Shares of Netflix were up 6.8% in U.S. premarket trading as of 7:55 a.m. ET.

Netflix reported earnings per share of $5.40 for the three-month period ending Sept. 30, surpassing the $5.12 LSEG consensus estimate. Revenues also beat expectations, coming in at $9.83 billion, above the $9.77 billion anticipated by analysts.

Crucially, Netflix saw momentum in its ad-supported membership tier, which jumped 35% quarter-over-quarter. While Netflix doesn't expect ads to become its primary growth drive until 2026, it said the ad-tier accounted for over 50% of sign-ups in the third-quarter in countries where it's available.

Netflix also gave an upbeat outlook for the December quarter, saying it expects fourth-quarter revenue to rise 14.7% to $10,128. It's forecasting revenue of $43 billion to $44 billion for 2025, which would mean growth of 11% to 13% from its expected 2024 revenue of $38.9 billion.

Analysts at Citi said in a note following Netflix's earnings report that the firm's fourth-quarter outlook "exceeded the Street" while its 2025 forecast "was relatively in line with consensus estimates."

"All told, we would expect to see shares trade higher" Friday on the back of earnings, Citi's analysts flagged.

Richard Broughton, executive director of Ampere Analysis, told CNBC's "Squawk Box Europe" Friday that Netflix has benefited from continued investments in content, despite a grim environment for the broader media landscape.

"It's a good indicator that some of the growth that dropped out of the market in 2022 is returning. If you think about the last 24 months, we've had cutbacks in content expenditure, hiring