(San Francisco) Netflix continues to gain millions of subscribers, but the streaming giant is now focused on retaining and engaging users drowning in a plethora of entertainment options.
The Californian group has more than 277 million subscribers worldwide, after gaining more than eight million new subscriptions in the second quarter, a result that once again exceeded expectations.
It also beat Wall Street expectations with $9.56 billion in revenue, including $2.15 billion in net income, according to its earnings release released Thursday.
Starting in 2025, however, the platform will no longer disclose its subscriber gains (or losses) every three months, in order to focus on audience “engagement” measures (time spent watching content).
Engagement “is the key to Netflix’s success. It’s the best indicator we have to measure the enjoyment of our users,” said the industry pioneer.
“When people watch more, they stay longer. [fidélisation]talk more often about Netflix [ce qui favorise l’acquisition de nouveaux abonnés] and place greater value on our service.”
Netflix has seen its subscriber numbers explode in recent quarters, thanks in particular to the tightening of its policy on sharing passwords between users, but this mechanism is playing less and less role, notes Ross Benes of the Emarketer firm.
The service “is reaching saturation in certain markets, so the time spent [à regarder des contenus] is more favorable to him,” explains the analyst.
” Each second ”
In this area, Netflix is not only facing its direct competitors (Disney, Apple, Amazon, Max, etc.), but also the many streaming and entertainment platforms, from YouTube to video games, TikTok and television channels.
In June, YouTube was the leading streaming service in the United States, with nearly 10% of the audiovisual market share, with Netflix coming in second with 8.4%, according to the Nielsen institute.
“The competition for entertainment is super intense,” Ted Sarandos, the company’s co-CEO, acknowledged at an analyst conference. “And we’re competing for every second of our content.”
Hit series like Bridgertonwhose third season debuted in May, is a major contributor to Netflix’s dominance.
But this dominance “shows signs of weakening,” estimates Mike Proulx, vice president of Forrester.
According to a study by the firm, it is “the only major broadcaster that saw its monthly usage decline among American adults online in 2024.”
“It is therefore all the more important for Netflix to continue to focus on its advertising activities in order to diversify and increase its revenues,” adds the analyst.
Let’s go live
Greg Peters, co-CEO, assured that the growth of the subscriber base for the ad-supported formula was aligned with their objectives.
But most other platforms also offer subscriptions with advertising, creating increased competition among advertisers.
To attract them, Netflix is putting in extra effort with live broadcast events, which are very popular with brands.
In sports, the company has signed a ten-year agreement with the American professional wrestling league WWE, for 5 billion dollars, and it will broadcast live on Saturday a boxing match between the YouTuber and apprentice boxer Jake Paul and the legend of the rings Mike Tyson.
Above all, in May it acquired the rights to at least four games of the professional American football league NFL, which will take place over the next three Christmases.
Netflix has so far steered clear of traditional competitions, which generate record audiences but are expensive. According to the Wall Street Journalthe group will spend $75 million on each of the two games this year.
The service is also increasing the number of live broadcasts in other areas such as comedy. On August 3, it will broadcast a show by Joe Rogan, a very well-known comedian in the United States, regularly accused of spreading conspiracy theories, particularly on his podcast.
“Ad revenue isn’t big enough for the company to report publicly yet,” Benes said. “But a year of sports and other live events is its best chance to change that.”