Netflix gained over 8 million subscribers in Q3 2023, mainly due to its ad-supported plans, and has also increased subscription prices in US, UK and France
Netflix’s subscriber base has expanded to 247.15 million as of September 30, 2023, a significant increase of 8.76 million in the third quarter of the fiscal year.
The subscriber’s growth was primarily attributed to its ad-supported plan, which saw a 70% increase in membership quarter-over-quarter and accounted for 30% of new sign-ups in countries where it is offered. The streamer’s $6.99-per-month ad-supported plan has been crucial in driving this growth in the US.
In addition to the ad-supported plan, Netflix increased the prices of its basic and premium plans in the US, the UK, and France. The new prices are $11.99 and $22.99 per month, respectively, for the basic and premium plans in the US, up from $9.99 and $19.99. In the UK, the basic and premium plans now cost £7.99 and £17.99 per month, respectively, and in France, they are €5.99 and €19.99.
Several original series contributed to Netflix’s subscriber growth in Q3, including the live-action adaptation of the Japanese manga “One Piece” and the USA Network drama “Suits,” which was particularly popular over the summer.
In Q2, Netflix reported an increase of 5.89 million paid subscribers, reaching 238.39 million global subscribers, an 8% increase year-over-year. This growth occurred during the period when Netflix began notifying customers that users outside their households would need to be added as extra members or pay for their subscriptions.
The strikes by writers and actors in Hollywood have also impacted Netflix’s production operations. The company expects its full-year 2023 free cash flow to be approximately $6.5 billion, up from its previous forecast of at least $5 billion. This includes about $1 billion in lower-than-planned cash content spent due to the strikes.
Netflix co-CEO Ted Sarandos was involved in the negotiations between the Writers Guild of America and the Alliance of Motion Picture and Television Producers, which resulted in an agreement on September 24. However, talks with the actors union SAG-AFTRA are ongoing.
On the executive pay front, Netflix has announced plans for substantial changes in 2024, moving towards a more conventional model based on pay for performance. This comes after most investors voted against the proposed executive pay packages for 2023 at the company’s June 1 annual shareholders meeting.
In 2023, co-CEO Ted Sarandos will receive a pay package worth up to $40 million, matching his 2022 compensation plan, while co-CEO Greg Peters will receive as much as $34.65 million.
Netflix’s stock closed at $345.91 per share on Wednesday. The US stock markets will reopen on Thursday at 9:30 a.m. ET. Wall Street has forecasted earnings per share of $3.49 on $8.54 billion in revenue, and Netflix has reported adjusted EPS of $3.73 on $8.54 billion in revenue.
Ragul Thangavel
With over nine years of diverse professional experience, Ragul has made significant contributions across various domains, including Media Operations, OTT Technologies, Video Production, Ecommerce, and Social Media.
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