LOS GATOS, Calif.—In its Q3 2023 earnings report, Netflix’s crackdown on password sharing helped the streaming giant increase subscribers even in the more mature and highly competitive U.S. and Canadian region where it added 1.75 million subs for a total of 77.32 million subs at the end of Q3 2023, a vast improvement over the 0.1 million subs it added a year earlier in Q3 2022.
Globally it added 8.76 million subs for a total of 247.15 million at the end of Q3 2023.
Netflix stock was up in early trading on October 19 as it generally outperformed financial expectations with Q3 2023 revenue hitting $8.5 billion with net income of $1.677 billion, up from 7.9 billion in revenue and 1.398 billion in net income a year earlier. Operating margins rose to about 20%.
In a letter to shareholders, the company noted that it was resuming its price hikes. “Starting today, we’re adjusting prices in the US, UK and France,” the company said. “In the US, our ads ($6.99) and our Standard plans ($15.49) will stay the same, while Basic will now be $11.99 and Premium $22.99.” That represents a $3 price hike for the Premium plan for subs who want to avoid ads and access 4K content.
The company also reported progress in its plans to make advertising a more important part of the business. “ In Q3 ’23, our ads membership increased nearly 70% quarter-over-quarter and now accounts for ~30% of all new sign-ups in our 12 ads countries.” the shareholder letter noted.
The company also noted that it was expecting to spend about $13 billion on content in 2023, a figure that had been reduced by ongoing strikes, and planned to spend around $17 billion in 2024.
