Netflix has experienced significant subscriber growth (over 9 million new subscribers in the latest quarterly report) and financial performance, marking its best start to the year since 2020. This success is attributed to a strong slate of original content and a crackdown on password sharing. Despite this positive performance, Netflix’s stock experienced a notable drop, reflecting investor concerns about the sustainability of this growth. Additionally, Netflix plans to stop reporting paid quarterly membership and revenue per subscriber metrics starting from the first quarter of 2025, shifting focus to broader financial indicators like sales and profit.
| Metrics | Q1’23 | Q2’23 | Q3’23 | Q4’23 | Q1’24 | Q2’24 Forecast |
|---|---|---|---|---|---|---|
| Revenue ($M) | 8,162 | 8,187 | 8,542 | 8,833 | 9,370 | 9,491 |
| Y/Y % Growth | 3.7 | 2.7 | 7.8 | 12.5 | 14.8 | 15.9 |
| Operating Income ($M) | 1,714 | 1,827 | 1,916 | 1,496 | 2,633 | 2,520 |
| Operating Margin (%) | 21.0 | 22.3 | 22.4 | 16.9 | 28.1 | 26.6 |
| Net Income ($M) | 1,305 | 1,488 | 1,677 | 938 | 2,332 | 2,063 |
| Global Streaming Paid Memberships (M) | 232.5 | 238.39 | 247.15 | 260.28 | 269.60 | – |
| Y/Y % Growth (%) | 4.9 | 8.0 | 10.8 | 12.8 | 16.0 | – |
| Global Streaming Paid Net Additions (M) | 1.75 | 5.89 | 8.76 | 13.12 | 9.33 | – |
| Net cash provided by operating activities ($M) | 2,179 | 1,440 | 1,992 | 1,663 | 2,213 | – |
| Free Cash Flow ($M) | 2,117 | 1,339 | 1,888 | 1,581 | 2,137 | – |
This decision has received mixed reactions from analysts. The company continues to innovate, introducing an advertising-supported service tier and investing in live programming to sustain its growth. Overall, the outlook for Netflix is cautiously optimistic, though it faces challenges in maintaining its growth trajectory.
