Netflix Inc. (NASDAQ:NFLX) has reported a surge in profits for the first quarter of the year, attributing part of this success to its crackdown on password sharing.
The streaming service revealed an addition of 9.3 million customers in the first quarter, expanding its subscriber base to nearly 270 million.
Profits soared to over $2.3 billion for the quarter, while revenue experienced a robust 15% year-on-year increase, reaching $9.37 billion.
However, Netflix has announced its decision to cease reporting key subscriber numbers starting next year, emphasizing that subscriber figures alone no longer adequately reflect its growth trajectory. Instead, the company urges investors to focus on its profitability and revenue streams.
While the unexpected decision to halt subscriber reporting raised concerns among some investors about the sustainability of Netflix’s growth, others viewed it as a strategic move to shift the narrative away from fixation on subscriber numbers.
Netflix’s stock (NASDAQ:NFLX) has experienced significant growth, climbing over 30% since the beginning of the year, though it dipped nearly 5% following the announcement.
The streaming giant’s success has been attributed to various factors, including its crackdown on password sharing, introduction of an ad-supported tier, and recent price hikes on certain subscription plans.
In addition to its financial performance, Netflix continues to expand its content offerings and explore new avenues such as sports and video games. Despite challenges faced by the industry, including strikes in Hollywood, Netflix remains resilient, with analysts highlighting its global footprint as a key strength.
Looking ahead, Netflix remains optimistic about its future growth prospects, reporting earnings that surpassed expectations and reaffirming its commitment to delivering engaging content experiences to its global audience.
Similarly, technology giant Meta Platforms, Inc. (META:NASDAQ), formerly Facebook, has also ceased reporting monthly active user numbers as growth slowed.
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