Netflix won’t reveal subscriber numbers from 2025

In an ultimate flex, Netflix announced it will stop revealing its subscriber numbers from next year.

The decision comes off the back of its financial results for the first three months of this year where it added a larger-than-expected 9.3 million subscribers worldwide for a total of 269.6 million.

The metric has been the key measure of success among streaming businesses, used by investors to judge a company’s earning potentials.

Netflix retiring its public disclosure reveals a confidence that it still sets the terms for the industry.

The company said in its financial earnings release it will only announce subscriber numbers when it reaches major milestones. It said the decision reflects its realignment to prioritise revenue and profit.

For the first quarter of the calendar year, its revenue rose 15 per cent to $US9.4 billion while net income came in at $US2.3 billion, a 79 per cent increase year-on-year.

It said in its release, “We’re focused on revenue and operating margin as our primary financial metrics – and engagement (ie. time spent) as our best proxy for customer satisfaction. In our early days, when we had little revenue or profit, membership growth was a strong indicator of our future potential.

“But now we’re generating very substantial profit and free cash flow. We are also developing new revenue streams like advertising and our extra member feature, so memberships are just one component of our growth.

“In addition, as we’ve evolved our pricing and plans from a single to multiple tiers with different price points depending on the country, each incremental paid membership has a very different business impact.”

Wall Street may not have yet embraced the pivot. Netflix shares were down in after-hours trading.

For the reporting period, it name-checked Griselda, 3 Body Problem, Avatar: The Last Airbender, American Nightmare, The Gentlemen, One Day, Damsel and Lift among its high-performing titles.

The Silicon Valley-headquartered business has often been the first mover in the industry and has emerged as the winner of the so-called streaming wars or, at least, the first era of the competition between it and rivals including Disney, Warner Bros, Apple, Amazon and Paramount.

Netflix’s subscribers surged during the lockdown years as restrictions kept people home but came to a crisis point in April 2022 when its membership went backwards for the first time in 10 years. The event led to a 25 per cent freefall of its stock price and a change in strategy which included the introduction of advertising-supported tiers and a password crackdown.

Password sharing was always against Netflix’s terms and conditions but it was never enforced. It had even posted on its social platforms, “Love is sharing a password”. The company revealed 100 million accounts engaged in password sharing.

It started beta testing in a range of territories and in February 2023, rolled out the crackdown worldwide. It offered existing customers an option to add an “extra member” to accounts for a fee that was smaller than an outright new subscription.

The move was a success. Disney is set to enforce its policy against password sharing from June in some countries and worldwide by September.

As for its ad-tier business, Netflix said in its release that membership on the lower-priced tier grew 65 per cent and accounts for 40 per cent of sign-ups in countries where it was available.