On October 19th Beijing time, American video streaming service provider Netflix released its financial report for the third quarter of 2023. According to the financial report, Netflix's revenue in the third quarter was $8.542 billion, an increase of 7.8% compared to $7.926 billion in the same period last year; The net profit was $1.677 billion, an increase of 20% compared to $1.398 billion in the same period last year.
From the perspective of paid users, the total number of Netflix global streaming paid member users reached 247.15 million, an increase of 10.8% compared to 223.9 million users in the same period last year.
Meanwhile, Netflix added 8.8 million new paid subscribers globally in the third quarter, up from 2.4 million in the third quarter of 2022, a year-on-year increase of 9%, reaching the highest level since the second quarter of 2020. This is thanks to the launch of paid sharing, strong and stable program production, and the continuous expansion of streaming media globally. In the second quarter of 2022, the number of new paid subscribers in the world reached 10.1 million. At that time, due to the global epidemic of COVID-19, people affected by control measures had to stay at home, and online streaming media business grew rapidly.
By region, the number of paid subscribers to streaming services in the United States and Canada in the third quarter was 77.32 million, compared to 73.39 million in the same period last year; The number of paid subscribers to streaming services in Europe, the Middle East, and Africa was 83.76 million, compared to 73.53 million in the same period last year; The number of paid subscribers to streaming services in Latin America was 43.65 million, compared to 39.94 million in the same period last year; The number of paid subscribers to streaming services in the Asia Pacific region was 42.43 million, compared to 36.23 million in the same period last year.
In September this year, Netflix's share of television screen time in the United States was 8%, higher than any streaming media other than YouTube.
Netflix financial report screenshot
Meanwhile, over 70% of Netflix's members are outside the United States, and Netflix mentioned in its report that it will provide an increasing number of exciting and authentic local stories to further meet their needs and increase their participation in these regions. Among them, One Piece, launched in August this year, is the best example of Netflix's diversity, coverage, recommendation mechanism, and fan effect. The live action version of "The Thief King", adapted from the best-selling Japanese manga series, has received high reviews, heated discussions, and huge views on social media (especially TikTok), with 62 million views worldwide (as of October 15th), making it the first English language work in Netflix's history to premiere in Japan and ranking first in Netflix's global top ten films for three consecutive weeks.
Pirate King liveaction movie poster
This is also the difference between Netflix and other streaming media platforms. Netflix respects local creation more than over adaptation. For example, the popular Netflix Korean drama "Squid Game" in 2021 is not only widely praised in South Korea, but also has a place in the world. It still ranks first in the overall ratings of Netflix dramas.
In addition to 'Pirate King', in the third quarter of this year, Netflix also released popular English dramas such as' Wizardry 3 ',' Ultimate Expert 3 ',' Sex Education 4 ',' Love at First Sight ', and' Suit ', as well as local dramas such as' Dear Child' (Germany), 'Cintonia' (Brazil), 'Guns and Gulabi' (India), and 'Classic Act' (France).
In terms of cash flow, Netflix's net cash generated from operating activities in the third quarter was $2 billion, compared to $600 million in the same period last year. The total free cash flow for this quarter was $1.9 billion, compared to $500 million in the third quarter of last year. Since the beginning of the year, a total of over $5 billion in free cash flow has been generated, compared to $1.3 billion in the same period in 2022.
Netflix expects free cash flow to be approximately $6.5 billion this year, higher than the previous forecast of at least $5 billion and an increase from $1.6 billion in fiscal year 2022. This includes the portion of approximately $1 billion in cash content expenses lower than planned for 2023 due to the Hollywood strike.
Netflix repurchased $2.5 billion in stocks in the third quarter and has now repurchased $4.1 billion. In September of this year, Netflix's board of directors increased its stock repurchase authorization, adding an additional $10 billion to the previously authorized $1 billion.
In addition, the report shows that in September this year, Netflix reappointed Susan Rice as a board member, who served as a board member from 2018 to 2020. Meanwhile, Netflix is listening to shareholders' opinions and plans to make significant changes to the executive compensation model of the past 20 years in 2024, adopting a more traditional model. The executive compensation plan will continue to be based on performance-based compensation.
In addition, it is worth noting that Netflix will increase user subscription prices in the United States, the United Kingdom, and France. In the United States, Netflix's advertising package subscription price of $6.99, standard package subscription price of $15.49 will remain unchanged, while the basic package has increased from $10 to $11.99, and the premium package has increased from $20 to $22.99. Users need to subscribe to the Netflix premium package to stream 4K, HDR10, Dolby Vision, and Dolby Panorama Sound.
Netflix also stated that in addition to the phased out countries of the United States, the United Kingdom, Italy, and Canada, it will also cease providing basic packages to new subscribers in Germany, Spain, Japan, Mexico, Australia, and Brazil next week.
