Netflix has made a surprising decision to discontinue reporting quarterly subscriber numbers, signaling a shift in its strategy amidst concerns over slowing customer growth.
Despite a significant increase in new customers, the streaming giant’s shares fell after it failed to meet analyst revenue forecasts.
The company attracted 9.3 million new customers in the first quarter, almost doubling analysts’ expectations and bringing its global total to 269.6 million by March’s end.
Netflix executives, including co-Chief Executive Greg Peters, emphasized a focus on revenue and operating margins as key metrics for assessing the company’s performance moving forward.
While the decision to cease reporting subscriber numbers quarterly may unsettle investors and pose challenges for analysts in modeling the company’s future, Netflix remains committed to driving growth through content diversification and its expanding ad-supported business.
Netflix’s recent offering of ad-supported plans, introduced in 2022, has contributed to a significant portion of new sign-ups, particularly in markets where the option is available.
The company reported that 40% of all sign-ups in such markets are for ad-supported plans.
Despite missing analyst revenue expectations for the first quarter, Netflix reported a strong financial performance, with earnings per share exceeding predictions and revenue reaching nearly $9.4 billion. Operating income also saw a notable year-over-year increase.
Netflix aims to continue broadening its programming to cater to its vast global audience. It recently secured a $5 billion deal to stream WWE’s wrestling show, “Raw,” and remains committed to producing high-quality films under the leadership of its newly appointed film chief, Dan Lin.
