Netflix Will Stop Regularly Telling Us How Many Subscribers It Has

Netflix added a whopping 9.33 million subscribers in the first quarter of the year, an impressive figure that blew away Wall Street’s expectations. We now know it has just shy of 270 million subscribers worldwide.

Well, don’t get used to it. 2024 is the last year Netflix will share publicly how many subscribers it added or lost in a given quarter during its quarterly earnings reports, the company announced on Thursday to kick off its fiscal 2024.

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The streamer writes that beginning in Q1 2025, Netflix will “stop reporting quarterly membership numbers and ARM,” which stands for “average revenue per membership.” So not only will we not know each quarter how many subscribers Netflix has at a given moment, we also won’t know how much revenue it made off each of those subscribers.

The company explains it’s now focused on revenue, operating margins, and engagement (time spent on Netflix) as its main barometers for success. That’s been a reaction to how Wall Street started valuing Netflix (and other streamers) after the “Netflix Correction” back in 2022, prioritizing profits over just chasing subs.

It doesn’t mean Netflix will never tell us how many members it has, but we won’t be getting quarterly public updates like we do now. It could lead to a sea change in the industry in terms of what other streamers publicly report, if any of them can become consistently profitable.

Co-CEO Greg Peters in the earnings call specifically said “we’re not going to be silent on members” and will still give periodic updates, but it “won’t be part of our regular reporting.” He also said starting this beginning in 2025 is to do this “thoughtfully and give everyone time” to adjust to the new reporting.

Co-CEO Ted Sarandos also added they believe engagement is the best metric of success in the streaming business, specifically as a barometer for growing revenue and profit. Thursday’s report emphasized some of its viewership numbers for the quarter, including “Griselda,” which had 66.4 million views in its first 91 days on the service. Sarandos also boasted that Netflix had the No. 1 original series on Netflix for nine of the 11 weeks reported by Nielsen so far this year.

In our early days, when we had little revenue or profit, membership growth was a strong indicator of our future potential,” Thursday’s earnings report reads. “But now we’re generating very substantial profit and free cash flow (FCF). 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.”

Netflix at the end of last year stopped providing guidance to Wall Street about how many subscribers it expected to add, but now it’s going a step further. Though it will still break out revenue by region for investors and annual revenue guidance.

Netflix co-CEOs Ted Sarandos and Greg Peters, alongside CFO Spence Neumann and VP of Finance/IR/Corporate Development Spencer Wang, will speak shortly in their quarterly live investor video interview.

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