Netflix Stock Up 9.5% On Q3 Earnings Beat, Warns ‘Headwinds’ Over Disney +, Apple TV+

Investors rewarded Netflix's mixed third quarter earnings results with a surge that sent the video streaming company's stock climbing 9.5% to $313.50 in extended trading Wednesday despite a streaming war against a bevy of new competitors looming on the horizon.

The Q3 earnings report, and the upcoming Q4, might be the fading light of an era once dominated by Netflix, according to some analysts. Next year will see the first bottom line impact of the surge in the number of competitors out to eat Netflix's lunch.

An indication of Netflix's waning domestic popularity is that its Q3 paid subscriber additions amounted to only 517,000 compared to the 802,000 expected, according to FactSet.

The most threatening of Netflix's new streaming rivals set to debut later this year are Disney’s Disney+; Apple’s Apple TV+; NBCUniversal’s Peacock and WarnerMedia’s HBO Max.

Netflix tried to downplay the heavy hits it will begin to take in 2020 by pointing out its "been competing with streamers (Amazon, YouTube, Hulu) as well as linear TV for over a decade." It did, however, warn the launch of these new streamers will generate what it claims will be “modest headwinds” in the short-term.

“The upcoming arrival of services like Disney+, Apple TV+, HBO Max, and Peacock is increased competition, but we are all small compared to linear TV," said Netflix in a statement.

"While the new competitors have some great titles (especially catalog titles), none have the variety, diversity and quality of new original programming that we are producing around the world.”

Netflix said its multi-billion dollar content budget and huge subscriber base give it the flexibility to target different projects. It also said it isn't afraid to take “bold swings” when necessary but won’t “chase every deal on the table.”

Netflix can take some measure of cheer in its Q3 results, which while downbeat in some key metrics, was nevertheless good enough to get investors to vote with their wallets.

Netflix reported these key earnings results as against expectations:

* Earnings per share: $1.47 vs. $1.04 expected (Refinitiv estimate)

* Revenue: $5.24 billion vs. $5.25 billion expected (Refintiv)

* Domestic paid subscriber additions: 517,000 vs. 802,000 expected, (FactSet estimate)

* International paid subscriber additions: 6.26 million vs. 6.05 million expected, (FactSet)

For Q4, Netflix expects to report earnings of $0.51 per share on revenue of $5.4 billion. It estimates 7.6 million global net adds compared to 8.8 million in the same quarter in 2018.