After record growth in the last quarter, Netflix broke the 300 million user mark. In the quarter with the release of the second season of the South Korean hit series “Squid Game,” almost 19 million users were added. That was about twice as much as analysts expected – the video streaming market leader also exceeded Wall Street forecasts for sales and profits. With the tailwind, Netflix immediately increased prices in the most important market, the USA.
Netflix now has 301.6 million customer households. The largest increase to date in a quarter was around 15 million at the beginning of the corona pandemic in 2020. With the record, however, Netflix will now stop providing information on the number of users. This was already announced last year.
Netflix shares are rising
Netflix’s revenue rose 16 percent year-over-year to $10.2 billion last quarter. The bottom line is that profits jumped from $938 million a year earlier to $1.87 billion. The results were well received by investors: the shares rose by more than 14 percent in after-hours trading.
On average, users watch around two hours of Netflix per day.
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The second season of “Squid Game” is now the third most successful Netflix series – behind season one and the American comedy-horror series “Wednesday”. At the same time, there were two live events in the last quarter that interested many users: a boxing match between veteran star Mike Tyson and influencer Jake Paul and the first Netflix broadcast of two games from the NFL football league.
At the same time, co-chief executive Ted Sarandos made it clear that Netflix is more interested in attracting potential new long-term customers with individual sports broadcasts rather than expensively buying the rights for an entire season of the major leagues. At the same time, Netflix will show the 2027 and 2031 Women’s World Cup.
Live programming plays an important role in Netflix’s advertising business. The streaming service, which was once completely free of advertising, is now increasingly relying on a cheaper subscription with ads. This means that Netflix is also attracting advertising expenditure that previously went to classic linear TV. According to Netflix, in the twelve markets where the subscription with advertising is available, the majority of new customers choose it.