Netflix Subscriber Additions Likely Slowed, Growth Strategy in Focus

FILE PHOTO: The Netflix logo is shown on one of their Hollywood buildings in Los Angeles, California, US, July 12, 2023. REUTERS/Mike Blake/File Photo
FILE PHOTO: The Netflix logo is shown on one of their Hollywood buildings in Los Angeles, California, US, July 12, 2023. REUTERS/Mike Blake/File Photo
TT

Netflix Subscriber Additions Likely Slowed, Growth Strategy in Focus

FILE PHOTO: The Netflix logo is shown on one of their Hollywood buildings in Los Angeles, California, US, July 12, 2023. REUTERS/Mike Blake/File Photo
FILE PHOTO: The Netflix logo is shown on one of their Hollywood buildings in Los Angeles, California, US, July 12, 2023. REUTERS/Mike Blake/File Photo

Netflix could report its slowest subscriber additions in six quarters on Thursday as gains from a password-sharing crackdown ease, with investors looking for signs its nascent ad revenue business is accelerating.
The streaming giant likely added 4 million subscribers in the July-September period, according to analysts' estimates compiled by LSEG. Netflix originals such as "The Accident" and "The Perfect Couple" were among the top streamed titles in the US during the quarter, Nielsen data showed, according to Reuters.
As the pace of sign-ups slows, Netflix is trying to shift investor attention towards other performance measures including revenue growth and margins. It will stop reporting subscriber data from 2025.
"Their focus is to continue to grow subscribers at a healthy clip while also leveraging their scale, ability to raise prices and increase advertising dollars," said Pivotal Research analyst Jeff Wlodarczak.
The company's ad-supported plan has been growing but Netflix does not offer details on the tier's financial performance and does not expect it to become a primary driver of growth until 2026.
This has raised some concerns about its growth trajectory.
"They're making less than a billion dollars a year in the US on advertising, saying that doesn't make them look good," eMarketer television and streaming analyst Ross Benes said.
Some analysts have said the company needs to raise prices and phase out more of its ad free plans to nudge customers towards the tier with commercials as it usually brings in more revenue per user.
The company said in July last year it would stop offering the $9.99 a month basic plan without commercials to new users in the US and the UK, and phase it out for existing subscribers.
Netflix charges $6.99 per month in the US for the ad tier, while its standard plan without commercials is priced at $15.49 a month.
It has not raised the price of its standard plan since early 2022, while its ad-supported tier has been priced the same since its launch in late 2022.
The company, which operates in more than 190 countries, is expected to report ad revenue of $242.7 million in the third quarter, according to the average of estimates from three analysts compiled by LSEG. Overall revenue is expected to grow 14.3%, a slightly slower pace than the previous three months, to $9.76 billion.
To attract more advertisers, the streamer is focusing on live events including sports. Netflix will air the highly anticipated Jake Paul vs. Mike Tyson boxing fight in November, followed by its first NFL games in December.
The second season of hit South Korean drama series "Squid Game,” expected to release in December, could help the company draw subscribers in the last quarter of the year.
Netflix stock has risen 12.4% since it reported second-quarter results in July, compared with a 5% rise in the S&P 500 index.



Saudi Entertainment Authority Inaugurates AlHisn Big Time Studios in Riyadh

AlHisn Big Time Studios feature seven studio buildings covering an area of 10,500 square meters. (SPA)
AlHisn Big Time Studios feature seven studio buildings covering an area of 10,500 square meters. (SPA)
TT

Saudi Entertainment Authority Inaugurates AlHisn Big Time Studios in Riyadh

AlHisn Big Time Studios feature seven studio buildings covering an area of 10,500 square meters. (SPA)
AlHisn Big Time Studios feature seven studio buildings covering an area of 10,500 square meters. (SPA)

Chairman of the Board of Directors of the Saudi General Entertainment Authority (GEA) Advisor Turki bin Abdulmohsen Al Al-Sheikh inaugurated on Monday AlHisn Big Time Studios, west of Riyadh, the largest and most modern studios for film and television production in the Middle East. The studios will help boost film and television production in the region.

AlHisn Big Time Studios, built in just 120 days, feature seven studio buildings covering an area of 10,500 square meters; the total project area measures 300,000 square meters. It also features a production village, with carpentry and metalworking workshops, as well as costume design facilities.

Additional amenities include luxurious suites for VIPs, offices for film production, and fully equipped editing rooms, all creating an ideal work environment that helps increase production efficiency.

The studios aim to streamline and accelerate production processes by concentrating the needs of film and television production in one location, saving time, effort, and costs, while supporting the production sector in the region on par with global standards.

The facility will provide a strategic opportunity for the financial and banking sector to support production companies. It will pave the way for a significant leap in film and television production at both local and regional levels.