Netflix reported its earnings from the fourth quarter of 2023 and recorded a surge of 13 million subscriptions from the last quarter, along with a 12.5% increase in year-over-year revenue. In the Q4 earnings report, Netflix disclosed over 260 million subscriptions. This results in a 13% year-over-year hike. This could be because of the password-sharing crackdown, and it looks like it is already working. The company also reported revenue of $8,883 million, along with an operating income of $1.5 billion in Q4. Netflix also notes that their subscriptions will likely be less in Q1 of 2024; however, they will increase visibly year-over-year and in the next three quarters.
It was reported that Netflix received 40% of new subscribers for the ad-supported tier accounts, more than the 30% from the third quarter. Moreover, the company plans to stop its least expensive ad-free option, known as the “Basic” tier. It will retire first in Canada and the UK by the spring, and everywhere else in this year itself. The new subscriptions for the basic tier were already stopped in December 2023, and they will likely be discontinued for existing customers as well in the upcoming months. These subscribers will have to switch to either one of the three options: Standard with ads for $6.99 per month, Standard without ads for $15.49 per month, or a Premium tier at $22.99 per month.
Also Read – Woman of the Hour on Netflix: Release Date, Cast, and More
The company also hinted at potential price hikes in a letter to the shareholders. “As our competitors adjust to these changes, it’s logical to expect further consolidation, particularly among companies with large and declining linear networks,” the company said. “We’re not interested in acquiring linear assets. Nor do we believe that further M&A among traditional entertainment companies will materially change the competitive environment given all the consolidation that has already happened over the last decade.”
