In the last three months of 2023, Netflix added more than 13.1 million new subscribers, reflecting an incredible rise from the previous year. The streaming giant maintained its growth pattern from the previous year, with this quarter seeing its greatest growth since 2020. Users were encouraged to register their own accounts as a result of the company’s crackdown on password-sharing, which contributed to this surge.
In an announcement, Netflix reinstituted its usual method of price increases, expressing confidence in its growth trajectory. With it out of the way, we can get back to our regular procedure,” co-CEO Greg Peters said. “Back to business as usual” may be the summary statement.
Surprisingly, a large number of new subscribers chose Netflix’s most affordable plan, which includes commercials. This option made up 40% of new sign-ups in the 12 countries where Netflix offers ad-supported subscriptions, which includes some of its largest markets like the US and UK. For years, Netflix fought advertising, claiming worries about viewer experience and economic issues as reasons. Now, they’re shifting their strategy toward ad-supported subscriptions.
In the first half of 2022, Netflix was hit with unanticipated subscriber decreases and reduced profitability. In response, the company looked for new ways to attract viewers and generate income. To broaden its content portfolio, the corporation is trying out more live events, in addition to ads and password crackdowns. A massive development occurred not long ago with the announcement of a $5 billion, 10-year agreement to stream WWE Raw on the service.
Even Netflix’s rivals are starting to do the same thing. For example, unless they pay more, Amazon Prime subscribers will see advertisements during live sports events, and the company is planning to improve these events. According to researchers, Netflix’s most recent results reflect its business plan and further secure its position as the top streaming platform. The transition to ad-supported plans has the ability to enhance revenue per account, even though advertising is not expected to make a significant contribution to growth in 2024, according to Netflix.
On Tuesday, Netflix got 18 Oscar nominations, including “Best Picture” for the film Maestro, highlighting the company’s excellent performance. The company’s reported earnings for 2023 were over $33.7 billion, an increase of over 6% over the previous year, and profits reached $5.4 billion, leading to a 6% spike in shares in after-hours trade.
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