Netflix’s second-quarter earnings show steady growth: NPR
Chris Delmas/AFP via Getty Images
Netflix is showing steady financial growth amid Hollywood’s ongoing labor struggles and the overall media market downturn.
Streamers have decided to kick off the media revenue season. Second quarter financials announced Wednesday.
After the market closed, the streamer’s share price was $477.59, nearly double what it was a year ago. The company said it added 5.9 million customers in the second quarter. It currently has 238.4 million paying subscribers worldwide and revenue of $8.2 billion.
“We expect revenue growth to accelerate in the second half of 2023 as we continue to see steady growth in our advertising-supported plans as we begin to take full advantage of paid sharing,” the company said in a report.
Paid sharing refers to the company cracking down on password sharing earlier this year. It currently offers a plan that allows account holders to add members outside the household for $7.99 per month.
The company’s ad-supported plans allow viewers to stream content for a lower monthly fee than ad-free plans. The company says its ad-supported plans have nearly 5 million monthly active users worldwide.
Netflix announced the end of its cheapest ad-free plan ($9.99 per month) hours before it announced its earnings on Wednesday.
“The Basic plan is no longer available to new or rejoining members. If you are currently on the Basic plan, you can continue with this plan until you change plans or cancel your account,” Netflix wrote in its article. website.
“Netflix continues to tweak the company to get back to its long-standing 15% to 20% growth rate,” said Andrew Werwitz, senior analyst at financial services firm Jefferies, of Netflix’s recent management decisions. (The company posted single-digit growth this quarter.)
The focus is now on Netflix because, unlike many of its rivals in the media and entertainment space, the company is profitable. “Every time Netflix does something, other companies follow suit,” said Rick Munaris, senior media analyst at investment advice firm The Motley Fool. “I’m the ultimate influencer who doesn’t take selfies.”
But Munaris said Wall Street overhyped the company’s success ahead of Wednesday’s earnings call.
“Subscribers are growing, but Netflix isn’t making a lot of money right now,” Munarith said.
Munaris also noted that the company’s free cash flow is expected to grow to at least $5 billion this year, up from a previous estimate of $3.5 billion. “So you would normally be like, ‘That’s great!'” Munarith said. “But as they explained, part of this is due to the writers and actors strike, and they don’t invest much in content, so they’re going to save some money.”
The company’s profitability is at odds with many Hollywood actors and writers going on strike. Their union blames streamers like Netflix, claiming industry changes have led to lower wages and working conditions.
In a video following Netflix’s quarterly earnings release, co-CEO Ted Sarandos said he wished the company had reached an agreement with the striking Hollywood Writers and Actors Guild by now.
“We’re always at the negotiating table with writers, directors, actors, producers and people across the industry,” Sarandos said. “We need to end this strike so we can all move forward.”
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Netflix announced steady growth in its Q2 2023 earnings report. Above, you’ll see his Netflix logo on a TV remote in July 2022.
Chris Delmas/AFP via Getty Images
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Chris Delmas/AFP via Getty Images
Netflix announced steady growth in its Q2 2023 earnings report. Above, you’ll see his Netflix logo on a TV remote in July 2022.
Chris Delmas/AFP via Getty Images
Netflix is showing steady financial growth amid Hollywood’s ongoing labor struggles and the overall media market downturn. Streamers have decided to kick off the media revenue season. Second quarter financials announced Wednesday. After the market closed, the streamer’s share price was $477.59, nearly double what it was a year ago. The company said it added 5.9 million customers in the second quarter. It currently has 238.4 million paying subscribers worldwide and revenue of $8.2 billion. “We expect revenue growth to accelerate in the second half of 2023 as we continue to see steady growth in our advertising-supported plans as we begin to take full advantage of paid sharing,” the company said in a report. Paid sharing refers to the company cracking down on password sharing earlier this year. It currently offers a plan that allows account holders to add members outside the household for $7.99 per month.
The company’s ad-supported plans allow viewers to stream content for a lower monthly fee than ad-free plans. The company says its ad-supported plans have nearly 5 million monthly active users worldwide. Netflix announced the end of its cheapest ad-free plan ($9.99 per month) hours before it announced its earnings on Wednesday. “The Basic plan is no longer available to new or rejoining members. If you are currently on the Basic plan, you can continue with this plan until you change plans or cancel your account,” Netflix wrote in its article. website.
“Netflix continues to tweak the company to get back to its long-standing 15% to 20% growth rate,” said Andrew Werwitz, senior analyst at financial services firm Jefferies, of Netflix’s recent management decisions. (The company posted single-digit growth this quarter.) The focus is now on Netflix because, unlike many of its rivals in the media and entertainment space, the company is profitable. “Every time Netflix does something, other companies follow suit,” said Rick Munaris, senior media analyst at investment advice firm The Motley Fool. “I’m the ultimate influencer who doesn’t take selfies.” But Munaris said Wall Street overhyped the company’s success ahead of Wednesday’s earnings call. “Subscribers are growing, but Netflix isn’t making a lot of money right now,” Munarith said.
Munaris also noted that the company’s free cash flow is expected to grow to at least $5 billion this year, up from a previous estimate of $3.5 billion. “So you would normally be like, ‘That’s great!'” Munarith said. “But as they explained, part of this is due to the writers and actors strike, and they don’t invest much in content, so they’re going to save some money.” The company’s profitability is at odds with many Hollywood actors and writers going on strike. Their union blames streamers like Netflix, claiming industry changes have led to lower wages and working conditions.
In a video following Netflix’s quarterly earnings release, co-CEO Ted Sarandos said he wished the company had reached an agreement with the striking Hollywood Writers and Actors Guild by now. “We’re always at the negotiating table with writers, directors, actors, producers and people across the industry,” Sarandos said. “We need to end this strike so we can all move forward.”
https://www.npr.org/2023/07/19/1188681937/netflix-earnings Netflix’s second-quarter earnings show steady growth: NPR