The company is focusing on revenue, operating margin, and engagement (time spent watching) as key metrics going forward. They argue that subscriber growth, which was critical in the early stages of development, no longer reflects established business models with strong margins, free cash flow, and promising revenue streams such as advertising and password sharing restrictions. Subscription tiers offering different prices further reduce the value of a single subscriber number.
While Netflix will stop publishing quarterly reports, it will continue to announce “significant subscription milestones.”
Investors should also pay attention to the expected slowdown in second-quarter subscriber growth due to seasonal trends. The company’s revenue forecast for the second quarter was $9.49 billion, slightly below analysts’ estimate of $9.54 billion. The news caused Netflix’s share price to fall slightly in afternoon trading.
Source: Ferra
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