Netflix Inc (NASDAQ:NFLX) stock surges 14.41% (As on October 19, 11:45:48 AM UTC-4, Source: Google Finance) after the company top earnings and revenue estimates, while subscriptions also beat expectations. Revenue, operating income and membership slightly exceeded the company’s forecast during the quarter, with big hits across TV and film. Netflix said it launched some of its most-watched series and films of all time, including Monster: The Jeffrey Dahmer Story, Stranger Things S4, Extraordinary Attorney Woo, The Gray Man, and Purple Hearts. For Q3, operating income totaled $1.5 billion vs. $1.8 billion in Q3’21. Operating income was above our beginning-of-quarter forecast, partially due to higher revenue, as well as a shift in timing of some spend from Q3 to Q4. As a result, operating margin of 19% was above the 16% forecast. The four percentage point year-over-year decline in operating margin is almost entirely due to the appreciation in the US dollar vs. most other currencies during this period.

NFLX in the third quarter of FY 22 has reported the adjusted earnings per share of $3.10, beating the analysts’ estimates for the adjusted earnings per share of $2.18. The company had reported the adjusted revenue growth of 6 percent to $7.93 billion in the third quarter of FY 22, beating the analysts’ estimates for revenue of $7.85 billion. This is driven by a 5% increase in average paid memberships and a 1% rise in ARM . Excluding the impact of foreign exchange (F/X), revenue and ARM grew 13% and 3 8% year-over-year, respectively. The sequential decline in revenue was entirely due to F/X. The company had under-forecasted paid net additions, which totaled 2.4 million vs. the 1.0m forecast and compared to 4.4m in the year ago quarter. In APAC, revenue grew 19% excluding F/X as average paid memberships rose 23% year-over-year. ARM was -3% year-over-year, excluding F/X, partially driven by lower ARM in India, somewhat offset by higher ARM in Australia and Korea. The company has added 1.4m paid memberships in the region (vs. 2.2m last Q3).

Looking ahead, Netflix sees fourth-quarter earnings of $0.36 per share, versus the consensus of $1.12, with revenue for the period expected to be $7.78 billion versus the consensus of $7.97 billion. Netflix’s revenue growth forecast is driven by its expectation for 4.5 million paid net adds compared to 8.3 million in the fourth quarter of last year. The company also said the strengthening of the US dollar will negatively impact its full-year 2022 revenue and operating income by $1 billion and $0.8 billion, respectively.