Netflix Adds Over 5 Million New Subscribers After Password Sharing Crackdown
Streamer comes in above expectations with nearly six million new subscriptions over the past quarter.
The earliest results from Netflix's heavy crackdown on password sharing appears to be fruitful for the streamer. In the platform's quarterly earnings released on Wednesday, Netflix revealed that it had a net gain of over five million subscribers during the course of the past three months.
"While we've made steady progress this year, we have more work to do to reaccelerate our growth," Netflix said in a letter sent to shareholders on Wednesday. "We remain focused on: creating a steady drumbeat of must watch shows and movies; improving monetization; growing the enjoyment of our games; and investing to improve our service for members."
The nearly-six million added subscribers represents an eight-percent growth for the company, which also reported $8.19 billion in revenues over the past quarter.
"Now that we've launched paid sharing broadly, we have increased confidence in our financial outlook," the company's shareholder letter added. "We expect revenue growth will accelerate in the second half of 2023 as monetization grows from our most recent paid sharing launch and we expand our initiative across nearly all remaining countries plus the continued steady growth in our ad-supported plan."
Why is Netflix cracking down on password sharing?
The idea of sharing account log-in information for accounts has been something Netflix has been aiming to crackdown on for the better part of the past year. With subscriber numbers dwindling, Netflix officials seriously began looking at implementing anti-sharing measures last year.
"We see a cancel reaction in each market when we announce the news, which impacts near term member growth," Netflix wrote in a shareholder letter at the time. "But as borrowers start to activate their own accounts and existing members add "extra member" accounts, we see increased acquisition and revenue."
The company added, "In Canada, which we believe is a reliable predictor for the US, our paid membership base is now larger than prior to the launch of paid sharing and revenue growth has accelerated and is now growing faster than in the US."