(San Francisco) Netflix now has 230.75 million paid subscribers, significantly exceeding its forecast and market expectations for the last quarter, and turning the page on a very difficult 2022 for the streaming service, after an earnings release released Thursday.
The platform also announced that its founder Reed Hastings was giving up his place as co-CEO to Greg Peters, alongside Ted Sarandos.
“I’m so proud of our first 25 years, and so excited for the next 25,” said Reed Hastings, who originally started a DVD rental service by mail. He will remain with the company as “executive chairman”.
PHOTO DAVID SWANSON, REUTERS ARCHIVES
Netflix Founder and Co-CEO Reed Hastings
Netflix went through a rough patch last year. The service had lost nearly 1.2 million subscribers in the first half.
It had started to attract millions again in the third quarter, and then gained 7.66 million new subscribers between October and December, much more than expected.
The platform has benefited in particular from new seasons of successful series such as The Crownabout the British royal family, and Emily in Parisbut also new programs, including the documentary series Harry & Meghan and the phenomenon series wednesday.
But Netflix remains “under great pressure to rectify the trajectory and achieve better results for its shareholders”, notes Paul Verna, analyst at Insider intelligence, after “its title lost more than 50% of its value in 2022”.
In the fourth quarter, the Californian company achieved 7.85 billion dollars in turnover, but generated only 55 million in net profit, well below the 257 million expected by the market.
Netflix took steps last year to generate new revenue streams, which should pay off this year.
In particular, the platform launched a new cheaper subscription in November, with advertising – a less prestigious solution that it had long refused.
“It’s the beginning of a turning point for the company,” said Mr. Verna. “We expect a relatively weak start, with advertising revenue of $830 million in 2023.”
“Because Netflix, like other streaming companies, faces stiff competition, economic headwinds and the urgent need to focus on profitability rather than subscription growth,” he explained. .