Netflix has announced that it added over 8 million subscribers in the three months leading up to June, surpassing investor predictions. The streaming giant attributed this growth to the success of new seasons of popular shows like Bridgerton and Baby Reindeer, as well as its tightened restrictions on password sharing.
However, Netflix warned that the impact of the password-sharing crackdown may wear off in the coming months, leading to slower growth. To combat this, the company is exploring new areas such as sports, live events, and gaming to maintain its lead.
“We believe that we have a lot more room to grow if we execute well – better stories, easier discovery, and more fandom – while also establishing ourselves in newer areas like live, games, and advertising,” Netflix said in a statement to investors.
The company’s total number of subscribers now stands at over 277 million globally, with an estimated total audience of over 600 million. In the UK, Netflix’s cheapest package, which includes ads, costs £4.99, while the same deal in the US costs $6.99.
Netflix reported “steady progress” in its ads business, with subscriptions to the plan up 34% in the quarter. However, the company did not share the total number and warned that the ads business would not start having a meaningful impact on revenue until 2026.
Analyst Jamie Lumley of Third Bridge noted that while Netflix’s ad-supported tier is an “important part of subscriber growth,” it has “yet to prove itself from a revenue standpoint.” Lumley added that Amazon has made a bigger splash in the ad market, and Netflix needs to continue working on scale in this segment to be a major player.
Netflix’s total revenue for the quarter was $9.56 billion, up 17% compared to the same period in 2023, while profits were $2.15 billion, compared to $1.5 billion a year ago. The company expects year-on-year growth of 14% in the July-September period.
