What you need to know
- Netflix has detailed its Q3 2022 earnings.
- The popular streaming platform has gained 2.4 million subscribers, achieving a higher mark than its forecasted one million.
- In 2023, Netflix will roll out account transferring and a way to monetize "password sharing" by introducing "sub-accounts."
This week, Netflix announced its Q3 2022 earnings, which sees the streaming beating its originally forecasted revenue, operating income, and membership additions.
The streaming platform has reported a 6% year-over-year revenue increase thanks to a 5% increase in average paid memberships brought about by 2.4 million subscribers. Netflix had undercut its own growth by previously forecasting it would only gain one million. Along with the increase in subscribers for Q3 2022, Netflix has reported revenue that stayed around the same during its Q2 report at nearly $8 billion for the quarter.
Netflix's Q2 earnings report saw the platform lose one million subscribers. While it did project it would lose around a million more, the company at least saw some revenue growth, which was likely due to the streaming service increasing its membership prices during that time.
Netflix is also preparing to introduce a new approach to tackle account sharing. The company stated that it will add new "sub-accounts" in early 2023, in which the account holder pays for extra members like a friend or family member that isn't part of the account owner's household. This is a way for the company to monetize traditional "password sharing" that has been popular on the service.
Additionally, Netflix plans to offer a way for borrowers of an account to transfer their profiles to their own account once they make one. This feature is intended for those unexpected life moments and will make it easier for account holders to shed extra members from their accounts to avoid paying for them. Transferring your account will keep your recommendations, viewing history, content list, saved games, and other personal preferences will not change when you separate.
Netflix also mentioned its recently revealed ad-supported plan, which it calls "Basic with Ads." This new plan will launch on November 3 and cost $6.99 in the U.S. However, Netflix is opening this new ad-based tier in 12 different markets, which it speculates accounts for roughly $140 billion in brand advertising across TV and streaming.
With this new subscription plan, Netflix aims to rope in nearly 40 million new subscribers by 2023.
As Netflix looks ahead to Q4 2022, the company projects it could earn around $7.8 billion in revenue. The streaming service attributes this slight decline to the strength of the U.S. dollar when placed against other currencies worldwide.
