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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
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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.

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Entertainment

André 3000's Alt-Jazz, ‘No Bars’ Solo Album Stunned Fans. Now, It’s up for Grammys

André Benjamin, also known as Andre 3000, arrives at the 30th Film Independent Spirit Awards in Santa Monica, Calif., on Feb. 21, 2015. (AP)
André Benjamin, also known as Andre 3000, arrives at the 30th Film Independent Spirit Awards in Santa Monica, Calif., on Feb. 21, 2015. (AP)
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André 3000's Alt-Jazz, ‘No Bars’ Solo Album Stunned Fans. Now, It’s up for Grammys

André Benjamin, also known as Andre 3000, arrives at the 30th Film Independent Spirit Awards in Santa Monica, Calif., on Feb. 21, 2015. (AP)
André Benjamin, also known as Andre 3000, arrives at the 30th Film Independent Spirit Awards in Santa Monica, Calif., on Feb. 21, 2015. (AP)

No one was expecting it. Late last year, André 3000 released his debut solo album, "New Blue Sun," 18 years after his legendary rap group Outkast's last studio album, "Idlewild."

But "New Blue Sun" has "no bars," he jokes. It's a divergence from rap because "there was nothing I was liking enough to rap about, or I didn't feel it sounded fresh. I'm not about to serve you un-fresh (expletive.)"

Instead, he offered up a six-track instrumental album of ambient alt-jazz — with special attention paid to the flute.

"The sound, that's how I got into it," he says of the instrument. "The portability, too. You can't tote around a piano and play in Starbucks."

He's also invested in the flute's history — like learning about Mayan flutes made from clay, a design he had re-created in cedarwood. "There’s all kinds of fables and, you know, indigenous stories that go along with playing the flute — playing like the birds or playing your heart like the wind — it kind of met (me) where I was in life," he says.

"Flutes — wind instruments in general — are the closest thing you get to actually hearing a human," he continues. "You're actually hearing the breath of a person."

"New Blue Sun" is a stunning collection, one that has earned André 3000 three new Grammy Award nominations: album of the year, alternative jazz, and instrumental composition. Those arrive exactly 25 years after the 1999 Grammys, where Outkast received their first nomination — for "Rosa Parks," from their third album, "Aquemini" — and 20 years after the group won album of the year for "Speakerboxxx/The Love Below."

"It matters because we all want to be acknowledged or recognized," André 3000 says of his new Grammy nominations. "It's a type of proof of connection, in some type of way ... especially with the Grammys, because it's voted on by a committee of musicians and people in the industry."

He's a bit surprised by the attention, too, given the type of album he created. "We have no singles on the radio, not even singles that are hot in the street," he says. "When you're sitting next to Beyoncé and Taylor Swift, these are highly, hugely popular music artists, I'm satisfied just because of that ... we won just to be a part of the whole conversation."

He theorizes that it may be because popular music listening habits are broadening. "A lot of artists are just trying different things. Even, you know, the album that Beyoncé is nominated for, it’s not her normal thing," he says of her country-and-then-some record, "Cowboy Carter.We’re in this place where things are kind of shifting and moving."

For André 3000, "New Blue Sun" has allowed him to "feel like a whole new artist," but it is also an extension of who he's always been. "Being on the road with Outkast and picking up a bass clarinet at a pawn shop in New York and just sitting on the back of the bus playing with it — these things have been around," he says.

He's also always embraced "newness," as he puts it, experimenting creatively "even if it sounds non-masterful."

"Even producing for Outkast, I was just learning these instruments. If I ... put my hands down and play ‘Ms. Jackson,’ I'm not knowing what I'm playing. But I like it," he says.

As for a new Outkast album, "I never say never," he says. "But I can say that the older I get, I feel like that time has happened."