Netflix posts best customer gain since surge during pandemic

Netflix signed up 13.1 million customers in the final three months of 2023, the streaming giant’s best quarter of growth since viewers were stuck at home in the early days of the pandemic.

The strong tally exceeded Wall Street’s estimate of 8.91 million and beat projections in every region of the world, with Netflix adding more than 5 million customers in Europe, the Middle East and Africa alone. Sales rose to US$8.83 billion, the company said Tuesday, also topping forecasts.

Netflix rebounded from a rocky 2022 by posting one of its strongest years of customer growth, buoyed by a crackdown on password sharing, the introduction of a cheaper advertising-supported option and a strong slate of programmes. Hit shows of the latest quarter included the post-apocalyptic thriller Leave the World Behind and a documentary about soccer great David Beckham.

Netflix’s strong performance stands in sharp contrast to many of its competitors in Hollywood, which operate shrinking cable networks and unprofitable streaming services. Those companies are now merging and cutting jobs to try and keep up.

Shares of Netflix rose as much as 8.9 per cent to US$535.91 in extended trading after the earnings announcement. They are up 38 per cent in the past year through the close in New York.

Just a couple of years ago, it seemed as though Netflix had hit a ceiling on growth after the company lost customers in the first half of 2022. But the steps taken since then have paid off.

“We believe we’ve successfully addressed account sharing, ensuring that when people enjoy Netflix they pay for the service too,” the company said in a letter to shareholders.