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October 19 , 2021 Fellow shareholders , After a lighter - than - normal content slate in Q1 and Q2 due to COVID - related production delays in 2020 , we are seeing the positive effects of a stronger slate in the second half of the year . In Q3 , we grew revenue 16 % year over year to $ 7.5 billion , while operating income rose 33 % vs. the prior year quarter to $ 1.8 billion . We added 4.4m paid net adds ( vs. 2.2m in Q3'20 ) to end the quarter with 214m paid memberships . We're very excited to finish the year with what we expect to be our strongest Q4 content offering yet , which shows up as bigger content expense and lower operating margins sequentially . Q4'21 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 ( in millions except per share data ) Revenue Y / Y % Growth Forecast $ 6,436 $ 22.7 % 6,644 $ 21.5 % 7,163 $ 7,342 $ 7,483 $ 7,712 24.2 % 19.4 % 16.3 % 16.1 % Operating Income $ 1,315 $ 954 $ 1,960 $ 1,848 $ 1,755 $ 500 Operating Margin Net Income Diluted EPS 20.4 % 14.4 % 27.4 % 25.2 % 23.5 % 6.5 % $ 790 $ 542 $ 1,707 $ 1,353 $ 1,449 $ 365 $ 1.74 $ 1.19 $ 3.75 $ 2.97 $ 3.19 $ 0.80 Global Streaming Paid Memberships 195.15 203.66 207.64 209.18 213.56 222.06 Y / Y % Growth 23.3 % 21.9 % 13.6 % 8.4 % 9.4 % 9.0 % Global Streaming Paid Net Additions 2.20 8.51 3.98 1.54 4.38 8.50 Net cash provided by ( used in ) operating activities Free Cash Flow * $ 1,264 $ ( 138 ) $ 777 $ ( 64 ) $ 82 $ 1,145 $ ( 284 ) $ 692 $ ( 175 ) $ ( 106 ) Shares ( FD ) 455.1 455.3 455.6 455.1 454.9 Note : Figures are consolidated , including DVD . * Free cash flow represents Net Cash provided by ( used in ) operating activities less purchases of property and equipment and change in other assets . Q3 Results and Q4 Forecast Revenue growth in Q3 was driven by a 9 % and 7 % increase in average paid streaming memberships and ARM¹ , respectively . Excluding a foreign exchange ( FX ) impact of + $ 128m , ARM rose 5 % year over year . Operating margin for Q3 amounted to 23.5 % , a three percentage point increase vs. the year ago period . This was above our beginning of quarter forecast due to the timing of content spend , as well as lower than forecasted marketing spend . EPS of $ 3.19 vs. $ 1.74 a year ago included a $ 136m non - cash unrealized gain from FX remeasurement on our Euro denominated debt . We under - forecasted paid net adds for the quarter ( 4.4m actual vs. our 3.5m projection ) , while ending paid memberships of 214m was within 0.4 % of our forecast . For the second consecutive quarter , the APAC region was our largest contributor to membership growth with 2.2m paid net adds ( half of total paid net adds ) as we are continuing to improve our service in this region . In EMEA , paid net adds of 1.8m improved sequentially vs. the 188k in Q2 as several titles had a particularly strong impact . The UCAN and ARM ( Average Revenue per Membership ) is defined as streaming revenue divided by the average number of streaming paid memberships divided by the number of months in the period . These figures do not include sales taxes or VAT . NETFLIX 1