Netflix reports 1.75 million new subscribers, to expand crackdown on password sharing

Netflix has released its latest financial results, revealing an increase in revenue and paid subscriptions for the January-March period of this year. The company was pleased with the results and announced that the “paid sharing” feature, which is essentially a crackdown on password sharing, performed well in its test markets of Canada, New Zealand, from Spain and Portugal. As such, the company plans to roll it out to more markets in the second quarter.

Revenue was up 4% on an annual basis, which was expected, according to guidance at the start of the quarter. Operating profit declined in the first quarter of 2023, compared to the same period last year, as “ongoing expense management and the timing of content hiring and spending” impacted net income.

The outlook for the remainder of the year is mixed. Due to the delayed implementation of paid sharing in more markets, some of the revenue growth in memberships and benefits will shift into the third quarter rather than into the second. Operating profit and revenue are expected to remain flat or slightly down, due to currency volatility.

When it comes to engagement, Netflix has proudly declared that it is, alongside YouTube, the undisputed leader in the streaming market, even though streaming is still a minor part of content viewing in all countries. The platform named its most successful productions: Outer Banks S3, You S4, Ginny & Georgia S2, as well as new movies and series like Oscar-winning All Quiet on the Western Front and Too Hot To Handle Germany.

Netflix lowered its prices in India in December 2021. It was so impressed with the overall results, leading to better engagement, that it adjusted prices in the other 116 markets it currently operates in the first quarter. Although the change resulted in a 5% decline in FY22 revenue, the company believes the increased adoption in these markets will help offset this in the longer term.

The new advertising plan is already attracting people in the United States, and Netflix is ​​expanding it to Canada and Spain starting today.

The company is aware that the crackdown on account sharing could lead to a “cancellation reaction”, as was the case during the demonstration in Latin America, but is confident that many will activate their own accounts and that current members will use the option to add “additional member”. ”.

Finally, the report marks the discontinuation of a once-essential feature – the company’s DVD business. Since 1998, DVD Netflix has offered a DVD rental service by mail with free two-way shipping, but this will stop later this year. Final shipments will be sent on September 29, and Netflix thanked its employees who worked on “building the booster rocket that has achieved a leadership position.”

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