Netflix announced on Tuesday that it added more than 2.4 million subscribers in the third quarter, the majority of which came from countries other than the United States. This ended a streak of customer losses that had occurred this year, which had caused investors to feel uneasy and prompted questions about how much further the streaming business could expand.
After exceeding its initial projection of around one million additions for the quarter, the powerhouse in the streaming industry said that it now has 223 million customers all over the globe. The first quarter saw a loss of 200,000 members for Netflix, while the second quarter saw a loss of over one million.
The streaming provider Netflix is getting ready to launch advertisements on its platform on November 3, as part of an effort to entice more users with a more affordable membership option. In the United States, members who sign up for the advertising-supported tier, which costs $6.99 per month, will see between four and five minutes of advertisements for every hour of material that they stream.
The company’s sales for the third quarter was around $7.9 billion, representing a rise of roughly 6 percent compared to the same time in the prior year. The profit that the corporation made was around $1.4 billion, which is down roughly 3 percent from the previous year.
In its letter to shareholders, Netflix said that the company anticipated adding 4.5 million customers in the fourth quarter. This is a decline of 46 percent from the 8.3 million users that Netflix attracted during the same time period in the previous year. Netflix also said that starting with the following quarter, it would no longer provide guidance to investors about its anticipated number of subscribers.
According to Rich Greenfield, an analyst at Lightshed Partners, the findings suggested that Netflix will thrive even as its rivals continued to fall farther and more behind.
Netflix did an about-face when it made the decision to provide an advertising option on the platform. For many years, the firm has promoted the fact that its service was free of advertisements as a selling feature for subscribers. Reed Hastings, the co-chief executive officer of the company, changed his stance this year after the company reported a drop in the number of subscribers during the first-quarter earnings call. He stated that an advertising-supported plan would give customers the ability to select the type of content they wanted to see.
Over the course of the last several years, streaming has developed into an increasingly competitive sector. For example, Disney said in August that it had about 221 million subscribers across all of its many service bundles. In December, it will begin providing a lower-priced advertising tier for Disney+ subscribers to use.
During a video interview with an analyst that was uploaded on Netflix on Tuesday evening, Mr. Hastings expressed his relief at the company’s financial performance. The interview was conducted by the analyst.
This autumn, Netflix will be challenging conventions in a variety of different ways. It will be the first time that the company has made a deal with all of the nation’s largest theatre chains at the same time. The company has plans to release “Glass Onion: A Knives Out Mystery” in 600 theatres across the United States beginning on November 23 for one week prior to its debut on streaming services. Rian Johnson is the writer and director of the highly anticipated follow-up film to the 2019 smash blockbuster starring Daniel Craig as the Delphic investigator Benoit Blanc. The film was written by Johnson.
This year, Netflix communicated to its staff that it was preparing to take more action to prevent users from sharing passwords, a practise that enables users to access material without paying for a membership. According to estimates provided by MoffettNathanson, the research company, more customers of Netflix disclose their passwords than users of any other major streaming service in the United States. Netflix estimated in April that users’ credentials were being shared with an extra 100 million homes, and the company issued a statement to that effect.
The corporation has also taken measures to reduce its expenses. In the month of May, Netflix fired over 150 employees throughout the organisation, the majority of whom were located in the United States. This represented approximately 2 percent of the company’s entire workforce. Netflix said in a statement that the reductions were necessary due to the slower revenue growth at the firm.
Netflix has not yet been successful in reversing a dramatic decrease in its share price, despite the reforms that have been made. Investors and analysts are struggling to understand the financial implications of streaming video, which has resulted in a decline of more than 60 percent in the stock price of the firm over the course of the last year.
The third quarter of 2018 saw the release of a variety of films and television shows on Netflix. One of these was “The Gray Man,” a high-budget action film starring Ryan Gosling and Chris Evans and directed by Joe and Anthony Russo, the same brothers who were responsible for “Avengers: Infinity War.” Other popular titles were the programme about a serial killer titled “Monster: The Jeffrey Dahmer Story,” the love drama titled “Purple Hearts,” and the show “Stranger Things,” the second part of which was published around the conclusion of the previous quarter.