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Tuesday, May 21, 2024  
12 Dhul-Qadah 1445  

Netflix reports rise in profits following crackdown on password sharing

Gained 9.3 million new subscribers

An American streaming service platform, Netflix has reported a significant increase in profits for the first quarter of this year, attributing its efforts to crack down on password sharing.

The streaming giant announced that it gained 9.3 million new subscribers during this period, bringing its total subscriber count to nearly 270 million.

The company’s profits for the quarter exceeded $2.3 billion (£1.85 billion).

However, starting next year, Netflix will no longer disclose its key subscriber numbers, emphasizing that subscriber growth is just one aspect of its overall growth.

The company urged investors to focus on its profits and revenue.

Netflix’s revenue for the first quarter rose by approximately 15% compared to the previous year, reaching $9.37 million.

The decision to stop reporting subscriber numbers led some investors to speculate that Netflix’s customer growth may be slowing down.

Other tech giants including Meta (formerly Facebook) and X (formerly Twitter) have also ceased reporting monthly active user numbers as their growth rates declined.

Netflix shares declined by almost 5% after this announcement.

Netflix last raised the price of its “standard” plan in 2022, which led to a temporary drop in subscribers and concerns about its market dominance.

In response, Netflix implemented measures against password sharing and introduced a less expensive plan with advertisements.

The company is expanding into sports and video games while continuing to license content from other media firms.

Analysts attribute Netflix’s success to its global reach, which helped ensure a steady stream of new shows despite industry disruptions in Hollywood.

Since the beginning of this year, Netflix shares have risen by over 30%, nearing their peak in 2021.

Netflix is an American subscription video-on-demand over-the-top streaming service, distributes original and acquired films and dramas to people available in various genres. It was found in 1997 by American entrepreneurs Reed Hastings and Marc Randolph.

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