Netflix Inc is expected to report its worst quarterly sales growth ever as its advertising-supported plan struggles to attract consumers in a saturated US market. This could put pressure on the company to cut down on its content spending this year.
Due to declining consumer spending, rising production costs and increased competition from Disney+ and Amazon Prime, the streaming giant is in trouble.
It had pinned its hopes on the introduction of an ad-supported tier, but according to analysts, there hasn’t been a sudden jump in subscriptions.
Read also: Twitter’s ad revenue drops 40% due to advertiser exodus after Musk’s acquisition
4.5 million customers are expected to arrive in the fourth quarter, which would be the lowest during the holiday season since 2014. Last year, 8.3 million additional customers were added.
There are some difficulties in achieving those customer goals, according to Jamie Lumley, an analyst at Third Bridge. It’s likely to focus on Netflix’s strong content investment, which, according to finance chief Spencer Newman, will total about $17 billion a year for the next few years.
Given current interest rates, Netflix has to be extremely choosy about the content it approves and the financing it uses.
Read also: ChatGPT – what exactly is it? how does it work?
Compared to Paramount Global, rival The Walt Disney Company anticipates spending on content at a lower $30 billion level for fiscal 2023. Disney doesn’t differentiate between its streaming and content spending from other businesses.
Faced with significant subscriber losses in the first half of 2022 due to the Russia-Ukraine conflict and a faltering economy, Netflix was forced to turn to advertising, a move it had long opposed.
Despite a return to subscriber growth in the third quarter, the company’s stock, which had been a favorite among investors during its years of rapid growth, still fell more than 50% by the end of the year.
frequently Asked question:
1. How to change your subscription plan on Netflix?
Enter your Netflix login information, select Change plan from the list of plan details, select Continue or Update after selecting the preferred plan, then select either Confirm or Confirm Change.
2. On how many devices can one access Netflix?
The number of screens you can watch at once is determined by your subscription plan, but the number of devices you can link to your account is unrestricted