By Todd Horwitz

Netflix Shares Jump

Netflix Inc. missed its subscriber-growth target for the second consecutive quarter, raising questions about the streaming-video giant’s ability to fend off competition from traditional media companies who are entering the market with rival services.

The company’s shares rose 8.5% in after-hours trading Wednesday as Netflix’s U.S. subscriber base did grow in the third quarter, calming investor fears that the streaming service would again lose subscribers domestically, as it did in the previous quarter. It also posted strong international subscriber growth. Before Wednesday’s report, the stock had fallen nearly 22% over the past three months.

Netflix’s quarterly report was the last one before two major competitors, Walt Disney Co. and Apple Inc., are to enter the streaming-video field with offerings that—even combined—cost less than Netflix’s most-popular plan.

For the third quarter, Netflix was boosted by new seasons of shows such as “Stranger Things” and “13 Reasons Why.” The company added 6.77 million paid customers around the globe, topping the nearly 6.7 million average expectation of analysts, according to IBES data from Refinitiv.

Netflix said it was on track to achieve full-year operating margins of 13% and was targeting another 300 basis point expansion in 2020. Its total subscriber count topped 158 million. Still, the company faces challenges. “Netflix results were good enough that they assuaged concerns about price sensitivity and penetration levels in the domestic markets,” said Fitch director Patrice Cucinello. “A caveat is that competition hasn’t hit yet.”

The company projected it would pick up 7.6 million customers in the last three months of 2019. Analysts had expected a forecast of 9.4 million. The company will release a new installment of “The Crown” and Martin Scorsese film “The Irishman” during that time.

Todd “Bubba” Horwitz