Streaming service gains 2.4m subscribers in the past quarter to comfortably top forecasts after ‘challenging’ first half of year
Netflix gained 2.4m new subscribers in the last quarter, more than double what had been forecast and offsetting back-to-back quarters of decline, the company reported on Tuesday.
The streaming company had been projected to gain 1m new subscribers over the past quarter, which included the launch of hit shows including Sandman, the latest series of Stranger Things, and Dahmer – Monster: The Jeffrey Dahmer Story.
But the company comfortably topped its own forecasts as subscribers returned and spent 1.35bn hours watching series four of Stranger Things, among other shows.
The company said in a letter to shareholders:
“After a challenging first half, we believe we’re on a path to re-accelerate growth. The key is pleasing members. It’s why we’ve always focused on winning the competition for viewing every day. When our series and movies excite our members, they tell their friends, and then more people watch, join and stay with us.”
Netflix has suffered as peers including Apple, Hulu, Amazon, and Disney have put money into streaming content. The company seized the opportunity to note its rivals were taking losses on their investments and still fell behind in terms of viewers.
The company said:
“Our competitors are investing heavily to drive subscribers and engagement, but building a large, successful streaming business is hard – we estimate they are all losing money, with combined 2022 operating losses well over $10bn v Netflix’s $5 to $6bn annual operating profit.”
Netflix brought in record subscriptions and viewership during the coronavirus pandemic – gaining 15.8m subscribers in the first three months of 2020. But subscriber numbers were hit as lockdowns eased causing a huge selloff in its shares. Its shares have lost 60% this year.
Buy Crypto NowAfter dismissing advertising for years, Netflix declared it is preparing to introduce a cheaper ad-supported service next month and is restricting password sharing, where several households share a Netflix subscription.
Netflix is still advancing far more slowly than it was. In the same quarter a year ago it gained 4.4m subscribers. The company declared that it will stop revealing subscriber numbers as it expands its business to include ad revenue.
Shares of Netflix jumped by over 14% in after-hours trading.
