While Netflix subscribers might be individually be frustrated about rising prices, canceled shows, ad-focused plans, and a crackdown on password sharing, Netflix isn't feeling a bit of it. The company just reported its full-year earnings, and with it a 13 million subscriber surge and 12.5% year-over-year revenue increase.
In its Q4 2023 earnings report, Netflix reported over 260 million subscribers, up 13 million from last quarter and nearly 13% year-over-year. It's a significant jump, with previous quarters only leaping in the single digit millions and likely at least somewhat due to an ongoing password sharing crackdown and the addition of cheaper payment tiers with ads. It's also reporting revenue of $8.8 billion and an operating income of $1.5 billion for the quarter.
The numbers have Netflix feeling confident, too. In its shareholder letter, Netflix expects "healthy double digit revenue growth" in the coming year and "continued record membership growth." The streaming company is looking to grow its ads business, its says, with the aim of making ads "a more substantial revenue stream that contributes to sustained, healthy revenue growth in 2025 and beyond." No shock there - Netflix reports that its ads plan now accounts for 40% of all Netflix sign-ups in markets where it's available, and Netflix is preparing to phase out its Basic plan further beginning with Canada and the UK in Q2.
Netflix does note that its subscription are likely to be down in Q1 versus the most recent quarter due to typical seasonality, but still expects the number to be up year-over-year and to recover in subsequent quarters.
With much of its most recent major business plans securely in place, Netflix is looking ahead to other types of growth in 2024. The letter suggests that it plans to continue investing in its own bespoke content line-up even as competitors cut back, sneaking in a release window for Squid Game Season 2 of 2024. And it also suggests that we should also expect to see continued industry consolidation - though Netflix suggest it isn't likely to partake in the consolidation itself.
“It’s logical to expect further consolidation, particularly among companies with large and declining linear networks,” reads the shareholder letter. “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 (Viacom/CBS, AT&T/Time Warner, Disney/Fox, Time Warner/Discovery, etc.).”
Finally, it's worth pointing out that, unshockingly, Netflix expects to keep raising prices. "As we invest in and improve Netflix, we’ll occasionally ask our members to pay a little extra to reflect those improvements, which in turn helps drive the positive flywheel of additional investment to further improve and grow our service," the shareholder letter reads.
We also learned this morning that Netflix would be exclusively streaming WWE Raw beginning in January of 2025, as well as all WWE shows and specials outside the US, as a part of Netflix's continued interest and investment in live programming.
Rebekah Valentine is a senior reporter for IGN. Got a story tip? Send it to rvalentine@ign.com.
