Netflix Revenues Rise 15 Percent in Q3

Adding 5.07 million net new subscribers in the third quarter to reach a total of 282.7 million members, Netflix saw its revenues rise by 15 percent in the period to $9.82 billion.

The U.S. and Canada brought in revenues of $4.3 billion, a 5 percent increase, with memberships at 84.8 million, a gain of 690,000. EMEA revenues were flat at $3.1 billion, with 2.2 million membership additions to reach 96.1 million. LatAm revenues were down 5 percent to $1.2 billion, with its subscriber base slipping slightly to 49.2 million. AsiaPac revenues also fell by 4 percent to $1.1 billion, but the platform added 2.3 million subs to reach 52.6 million members.

“Engagement, our best proxy for member happiness, remains healthy,” the streaming giant said in its letter to shareholders. “Through the first three quarters of 2024, view hours per member among owner households (the clearest view of engagement trends post the introduction of paid sharing) increased year over year.”

The company also touted gains in its ad-supported tier, which grew 35 percent quarter on quarter. “However, we have much more work to do improving our offering for advertisers, which will be a priority over the next few years. Our in-house first party ad tech platform is on track to roll out in Canada next month, with a broader launch to all ads countries in 2025. We’ve also expanded our programmatic capabilities with The Trade Desk and Google DV 360, which is going well. It’s still very early for our advertising initiative. As we said last quarter, it takes time to build a new revenue stream and we don’t expect ads to be a primary driver of our revenue growth in 2025. The near-term challenge (and medium term opportunity) is that we’re scaling faster than our ability to monetize our growing ad inventory. While this creates a short term drag on ARM, we are balancing building ads scale (for more meaningful ads revenue and ARM contribution over time) while still delivering healthy overall revenue growth in the near term. And we’re making progress with ads monetization, as we saw in this year’s U.S. Upfront, closing deals with all major holding companies as well as independent agencies, with a 150 percent plus increase in upfront ad sales commitments over 2023, in-line with our expectations.”

Its letter to shareholders also pointed to the bundling trend—and Netflix’s ability to avid it. “Programming for such a large, engaged audience, with so much variety and great quality, is hard. It’s why streaming services which lack our breadth of content are increasingly looking to bundle their offerings (selling and discounting their services together, channel offerings, etc.). Netflix is already an extraordinary package of series and films (licensed and original), and increasingly games and live events—all in one place and for one price, easy to use and great value for money. At just under 10 percent of TV time today in our biggest countries, we believe there’s a huge opportunity to grow that share by investing even more in our slate and continuing to improve the variety and quality of our offering. Part of that improvement is ensuring we have a steady drumbeat of great, new TV shows, movies and games throughout the year to satisfy our members.”

Its volume of content has picked up again after a “patchy” 2024 following the strikes, the platform noted.