Netflix announced in its first quarter earnings report a substantial increase in subscribers, with 9.3 million added, but also revealed plans to stop sharing quarterly membership numbers starting in 2025. The company’s focus has shifted from member growth to revenue and profit, with new revenue streams such as advertising and extra member features becoming important components of growth. In addition to discontinuing quarterly membership numbers, Netflix also announced that ARM, or average revenue per membership, would no longer be included in reports in 2025.
In response to a loss of subscribers at the start of 2022, Netflix launched a cheaper, ad-supported plan and gained almost 9 million subscribers by the end of the year. Subscriber growth continued to increase throughout 2023 and into 2024, with 13.1 million added by the end of 2023 and another 9.3 million in the first quarter of 2024. The company’s focus on engagement as an indicator of member satisfaction has led to initiatives such as cracking down on password sharing and hiking prices for some customers.
Netflix is expanding its content offerings by moving into live sports, with plans to start airing WWE Raw in 2025 and exclusively broadcasting social media star Jake Paul’s boxing match with Mike Tyson in July. The company’s Co-CEO Ted Sarandos emphasized the importance of member engagement, stating that happy members watch more, stick around longer, and tell friends, leading to growth in revenue and profit. However, there have been reports of layoffs in the company’s film department as part of a reorganization effort.
The decision to discontinue sharing quarterly membership numbers and average revenue per membership reflects Netflix’s evolving business priorities and focus on revenue and profit generation. As the streaming giant continues to grow and expand its offerings, such as live sports programming, the company is strategically positioning itself for future success. By prioritizing member engagement and satisfaction, Netflix aims to drive growth and profitability in the increasingly competitive streaming market.
