Global Courant 2023-04-19 02:54:08
Netflix began restricting password sharing in four other countries earlier this year, but chose not to expand more widely after it “found plenty of room for improvement” in early launches.
The delayed timing, announced in the company’s latest earnings results, may have contributed to the company’s challenges growing its subscriber base in the March quarter.
The company reported a net increase of 1.75 million global streaming subscribers, up nearly 5 percent from the same period last year, but less than the more than 3 million Wall Street analysts had expected.
Netflix said it’s seen a “cancellation reaction in every market when we announce the news” about the paid sharing option, but then sees “increased acquisition and revenue.” However, by delaying the rollout, Netflix said “some of the expected membership growth and revenue benefit will decline in the third quarter rather than the second quarter.”
Tuesday’s earnings report is the first for new co-CEOs Greg Peters and Ted Sarandos, after founder Reed Hastings handed over the role to become executive chairman in January.
It’s been a pivotal quarter for Netflix as the company looks to grow some new revenue opportunities after last year’s rocky performance, including losing 200,000 subscribers in the quarter last year, which led to a major sell-off. The company has also been working to grow its new ad-supported subscription offering, which launched last year.
“Engagement at our ad level has exceeded our initial expectations and, as expected, we’ve seen very little move from our standard and premium plans,” the company said in its subscriber letter Tuesday.
Netflix reported revenue of approximately $8.2 billion for the quarter, up nearly 4 percent from the same period last year and in line with analyst projections. The company’s quarterly revenues fell 18 percent to $1.3 billion.
Netflix said it expects revenue to grow nearly 5 percent to $8.2 billion in the three months ending June, but expects quarterly profit to fall more than 19 percent from the same period last year.
The report comes days after Netflix botched what was supposed to be its second ever live show — the Season 4 “Love is Blind” reunion — and had to apologize to frustrated fans and tape the special for streaming. Unlike its streaming rivals, Netflix has long been resistant to live streaming due to its high cost. But, facing tougher competition, Netflix has started experimenting with the format, a format it apparently hasn’t perfected yet.
Netflix also said on Tuesday it would be officially ending the DVD rental service that made it a household name this fall.
