☀️ NETFLIX Q3: The Good, Bad and Mysterious

A #MediaNerd🤓 dive into the Q3 2023 NETFLIX Numbers, and what's ahead in 2024

#MediaNerd🤓 Returns!

NETFLIX Q3 Subscriber adds boom past expectations… but Revenue doesn’t

Welcome to Q3 earnings season! As always, starting off with the world’s most popular streaming service, NETFLIX, which… apparently got a lot more popular in Q3 2023.

MAIN TAKEAWAYS

Under Promise/Overdeliver… again

• NETFLIX blew subscriber predictions out of the water… both from analysts and its own broad forecast, adding +8.76 Million in Q3.

  • EMEA: About half of that subscriber growth was here (EUROPE / MIDDLE EAST / AFRICA), although no breakdown was given as to where exactly.

  • U.S./CAN: The Password Crackdown gave NETFLIX its biggest quarterly sub growth here since the start of the pandemic (Q2 2020).

• BUT CURIOUSLY: Even though NETFLIX topped its Q3 subscriber addition forecast by almost +50%… it didn’t really exceed its Revenue forecast for the quarter 🧐.

  • Q3 revenue was +8% YoY instead of the forecast +7% YoY 🤷‍♂️ (and only about $42 Million more than the $8.5 Bil forecast).

  • WHY THE SMALL GAIN?

    • The additional subscriber growth came from lower ARPU regions.

    • Mix of people taking lower-priced packages was greater than thought.

  • HENCE: NETFLIX ARPU growth is challenged (avg. revenue per user): -1% YoY globally

    • NETFLIX calls ARPU “ARM” btw (avg. rev per member) - basically it’s their “fetch”.

• WHAT TO DO? One main tactic…