The beautiful fix has returned to Netflix. The American streaming platform gained more than thirteen million subscribers during the fourth quarter of 2023, including nearly three million in the North American market, and now has more than 260 million customers in the world.
The video-on-demand veteran, which had already gained nearly nine million subscribers during the summer, achieved $8.8 billion (approximately €8.1 billion) in revenue during the holiday season (12.5% in one year), according to its results press release published Tuesday January 23, a performance higher than analysts’ forecasts. And it has big ambitions for the current quarter, betting on 13% growth, or more than $9 billion in revenue, and nearly $2 billion in net profit. Furthermore, its title gained more than 8% during electronic trading after the close of the New York Stock Exchange.
“We think there is a lot of room for growth with the expansion of streaming,” said the two bosses, Ted Sarandos and Greg Peters, quoted in the press release. “If we continue to improve Netflix faster than the competition, we will have a company that is consistently more valuable to consumers, creators and shareholders.”
They also congratulated themselves on having launched the cheaper subscription formula with advertising, supposed to generate “long-term profits”. “We are at twenty-three million active monthly users” of this formula, said Greg Peters, co-general manager of the company, during a conference call. In November 2023, Netflix announced fifteen million.
For the period from October to December 2023, the Californian group’s net profit came out a little lower than expected, at $938 million instead of $990 million, but well above the $55 million for the same period the previous year.
New content after the end of the Hollywood strike
Netflix began a decline in 2022 when the company suffered a decline in subscribers for the first time in ten years in the first quarter. The pioneer of online video services then raised the bar, notably thanks to its stricter policy in terms of sharing passwords between users.
At the end of 2023, the final seasons of series like Sex Education or The Crown attracted viewers, as did Berlin, a derivative of the hit series La Casa de Papel, or even Squid Game: The Challenge, a show from reality TV series inspired by the South Korean phenomenon Squid Game; the latter also returns to the platform in 2024 with a second season, alongside Bridgerton and Emily in Paris.
“Despite the strikes last year which postponed the launch of certain titles, we have a substantial and bold program for 2024,” assured Netflix. Like its competitors, it can resume producing new content in the United States since the end of the historic strike in Hollywood in November 2023.
The industry was paralyzed for six months by the double social movement of screenwriters and actors. In particular, they demanded salary increases and safeguards in terms of artificial intelligence. The main streaming services, however, assured that the impact of this strike would be limited for them, especially since it incidentally allowed them to save money.
Wrestling arrives on the platform
While Disney is still figuring out how to achieve profitability, Netflix’s operating margin came in at 20.6% for its full fiscal 2023, higher than its guidance. And the Los Gatos (California) company sees it improving significantly again in 2024.
Enough to allow Netflix to expand further into other entertainment areas already occupied by its competitors, such as sport. The group announced on Tuesday morning that it had signed a ten-year broadcasting agreement with the American professional wrestling league WWE, for $5 billion. From 2025, it will gain exclusivity in the United States for Raw, WWE’s flagship show which last year was among the best audiences on American cable.
“This is the heart of our vision for sports, centered on drama,” said Ted Sarandos, co-CEO of Netflix. This represents fifty-two weeks of live programming each year and is part of our ambitions for more live broadcasts. »
This is a major step for the platform which has until now remained relatively behind in the race for broadcasting rights to sporting events. Amazon recently launched into this market, while Disney – through its subsidiary ESPN –, Warner Bros Discovery and its Max platform, or Peacock, an offshoot of the NBCUniversal group, already controlled significant portfolios of rights which enabled them to to add competitions to their streaming offering.