May 3, 2024

Netflix to Stop Providing Subscriber Numbers.

Trend Analysis
Szymon Karbowski
Netflix to Stop Providing Subscriber Numbers.

Netflix will stop providing subscriber numbers in 2025, marking the end of an era in the streaming wars. The company said the change comes amid different pricing for plans and a greater focus on revenue and engagement.

Netflix will stop reporting quarterly subscriber numbers starting with its first quarter earnings in 2025. The company says it's focusing more on other metrics. The streaming giant said on Thursday it would stop reporting average revenue per member, which it calls ARM.

The company had already stopped providing guidance on the number of paid members from 2023. Netflix said in the company's earnings report that the decision came amid rising profit numbers.

"As we've noted in previous letters, we focus on revenue and operating margin as our primary financial metrics - and engagement (i.e., time spent) as our best proxy for customer satisfaction. In our early days, when we had little revenue or profit, membership growth was a strong indicator of our future potential. But now we're generating very substantial profits and free cash flow (FCF)," the earnings release said.

The company will continue to provide a quarterly breakdown of revenue by region, as well as F/X. In addition, Netflix will begin providing annual revenue guidance. "We will also announce key subscriber milestones as we pass them," the company said.

Netflix's subscriber numbers and profits are growing. The company added 9.3 million subscribers in the first quarter, bringing its global subscriber base to 269.6 million. This expansion has widened its already large lead over its competitors. Netflix reported revenues of $9.4 billion and operating income of $2.6 billion, both significantly higher than a year ago.

Netflix already has a lead over its competitors in terms of subscribers, with rival Disney+ reporting a base of nearly 150 million. The company's numbers have also been boosted by its crackdown on password sharing, which can convert borrowers into new users. Moving away from the subscriber metric is a bold move. It has been a focus for Wall Street since the early days of the streaming wars and may continue to be, especially if profits are not yet in sight. I wonder if Netflix's decision, about not to publish the number of subscribers to their service, will really end the streaming wars between the biggest players among streaming platforms?

#SzymonKarbowski #StreamVX #Netflix #StopProvidingSubscriberNumber #TheStreamingWars #CustomerSatisfaction #Revenue

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