Netflix has reported a significant increase in profits for the first three months of this year, attributing the growth in part to a crackdown on password sharing. The streaming giant revealed that it added 9.3 million customers in the first quarter, bringing its total subscriber base to almost 270 million.
The company announced that its profits for the first quarter surged to over $2.3 billion, with revenue rising nearly 15% year-on-year to $9.37 billion. Netflix also highlighted the success of its original content, such as the crime drama Griselda, in driving growth.
Despite the positive financial results, Netflix made a surprising decision to stop reporting key subscriber numbers from next year. In a letter to shareholders, the company stated that subscriber numbers are now just one component of its growth, urging investors to focus on its profits and revenue instead.
However, some analysts have raised concerns about the implications of this move. Jamie Lumley of research firm Third Bridge questioned the growth prospects of Netflix’s subscriber base following the decision to halt reporting subscriber numbers. The decision echoes similar moves by other technology giants like Meta and X, who stopped reporting monthly active user numbers as growth slowed.
Netflix shares have risen by more than 30% since the beginning of the year, but they experienced a 5% drop after the announcement. Analysts emphasized Netflix’s edge in original content and global footprint as key factors contributing to its success, despite challenges in the streaming market.
Looking ahead, Netflix continues to explore new avenues for growth, including ventures into sports, video games, and licensing content from rival media firms. The company’s ability to leverage its unique content offerings and global reach will be crucial in maintaining its position in the competitive streaming industry.
