After cracking down on password sharing, expanding into ads and investing billions in live TV, group declares success
Callum Jones in New YorkThu 17 Oct 2024 16.45 EDTLast modified on Thu 17 Oct 2024 17.42 EDTShareNetflix expects to double its profits this quarter after the world’s largest streaming service added more than 5 million new subscribers this summer.
After cracking down on password sharing, introducing adverts to its service and investing billions in live TV, the group declared it had “delivered” on plans to shore up its business.
Hits including The Perfect Couple and Emily in Paris drew viewers to the platform in the last quarter. Netflix hopes a new season of Squid Game will bolster its audiences as the year draws to a close.
The company’s base of paying subscribers grew by 5.1 million to a record 282.7 million in the three months before 30 September. Revenue at Netflix rose 15% to $9.83bn, as net income increased 41% to $2.36bn.
Subscription growth did slow significantly, however, renewing questions about the trajectory of its vast base. Netflix added 9.3 million and 8.1 million customers in previous quarters this year.
As it attempts to shift investors’ attention away from the size and growth of its audience, the company forecast net income of $1.85bn during the current quarter – up from $938m in the same period last year.
British-made Netflix shows most popular on platform so far in 2024Read moreShares in Netflix rose 4.5% during out-of-hours trading.
“We’ve delivered on our plan to reaccelerate our business,” it said in a letter to shareholders. “As we look ahead to 2025, we’re focused on improving every aspect of our service and continuing to deliver healthy revenue and profit growth.”
Netflix, based in Los Gatos, California, pioneered the streaming revolution. Hollywood’s established giants, from Disney to Warner Bros, are still scrambling to catch up – and turn a profit on their own rival digital services.
A boom in subscribers early in the pandemic, with much of the world stuck at home, stuttered in 2022 as restrictions were lifted and viewers ventured beyond their sofas. But shares in Netflix have since rallied sharply as the company reassured Wall Street it was taking action to regain momentum.
It has also invested heavily in live broadcasting, striking a decade-long deal with World Wrestling Entertainment (WWE) and acquiring the rights for two NFL games on Christmas Day.
The platform is preparing to stream a fight between the YouTube star Jake Paul and boxer Mike Tyson next month. Last week, the company also announced plans for a live weekly talkshow, hosted by the comedian John Mulaney, to launch on its service next year.
Aside from maintaining the growth of its audience, Netflix is trying to ensure that existing customers stick around. The group assured investors that engagement was “healthy” on its platform, with “around two hours a day per paid membership on average”.
