Oct 22 -

Netflix ( NFLX ) shares fell 7% in premarket trading on

Wednesday after the streaming giant's fourth-quarter revenue

outlook failed to impress investors despite a strong line-up of

shows, including the final season of "Stranger Things".

The tepid outlook undermines the company's run of strong

revenue growth in recent quarters, thanks to hit shows and

movies including "KPop Demon Hunters" that have helped boost

Wall Street's expectations.

Netflix ( NFLX ) is set to release the final season of "Stranger

Things" in November and stream two live National Football League

games on Christmas.

The company also missed third-quarter profit estimates due

to unexpected expenses related to an ongoing dispute with

Brazilian tax authorities, amounting to about $619 million,

which weighed on an otherwise strong content quarter.

"The Brazil tax expense creates noise, but it's not an

issue... we believe the bigger focus on numbers is the lack of

revenue upside in the back half," said analysts at J.P.Morgan.

Netflix's ( NFLX ) revenue for the third quarter was in line with

forecasts, at $11.5 billion, while for the fourth quarter, it

forecast $11.96 billion, compared with Wall Street's projection

of $11.90 billion.

The company has ventured into advertising and video games to

diversify its revenue streams, but these businesses have

struggled amid shifts in leadership and strategy, along with

stiff competition.

However, the company's management said on a post-earnings

call that it recorded its best ad sales quarter in history

during the July-September period, without disclosing a number.

Netflix ( NFLX ) does not reveal subscription numbers as well, making

it difficult for analysts to predict its financial performance.

"With no subscriber numbers, some advocates are grasping at

straws to find any sign of weakness, as the company is faring

much stronger than its rivals," said PP Foresight analyst Paolo

Pescatore.

Netflix's ( NFLX ) stock is up 40% this year, outperforming its

media peers as well as the S&P 500. Its forward

price-to-earnings multiple, a common benchmark for valuing

companies, is 39.59, well above the average of the so-called

FAANG group of stocks that includes tech heavyweights Apple and

Google.