Netflix said it increased its subscriber base to 9. 33 million internationally in the first quarter, double what Wall Street expected.
Its functionality improved thanks to the company’s crackdown on password sharing, which led to new sign-ups, as well as its cheaper, ad-supported option. The advertising tier costs less ($6. 99 per month) than adding an external member to your family. ($7. 99 consistent with the month).
Netflix “added more subscribers than many analysts, myself included, expected,” wrote Ross Benes, principal analyst at Emarketer. “This indicates that password sharing was even less unusual than previously thought, as Netflix continues to convert the leveraged audience into paid users. “
It’s possible there could be even more expansion in the future, as the crackdown helped attract some 30 million subscribers in FY23, while an estimated 100 million users share their passwords, Macquarie wrote in a study note.
Netflix said its ad-supported tier grew 65% quarter-over-quarter, following sequential increases of nearly 70% over the past two quarters. More than 40% of subscriptions in their markets that offer the advertising level are for this option.
The folks at Disney will be watching closely, as the company prepares to beef up password sharing at Disney this summer, with an all-out offensive in the fall.
Warner Bros. Discovery also announced that it will begin restricting password sharing on the Max streamer later this year.
So, cracking down on password sharing is still a win for Netflix, even if it gives you a roadmap to copy.
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