Netflix has reported Q1 revenue and earnings that are largely in line with Wall Street’s expectations. However, the company’s forecast for the next three months fell short of analyst estimates.
The introduction of an ad-supported tier and a crackdown on password sharing has benefited the company, and it has posted $2.88 per share diluted earnings for the January-March period, in line with analyst estimates. Its revenue for the same period was $8.162 billion, also in line with Refinitiv’s analyst estimates.
Netflix is a bellwether for the streaming industry, which has seen slowed growth due to increased competition.
The company missed analyst estimates for the quarter, adding 1.75 million subscribers compared to the estimated 2.06 million.
A year ago, the company had experienced its first subscriber decline in over a decade, causing a decrease in stock prices and resetting the expectations of the sector.
The March quarter lacked major releases, but non-English shows such as “The Glory” and “La Reina del Sur” were successful, according to Jefferies.
Netflix has faced strong competition from Disney, Amazon.com, and Warner Bros Discovery. Amazon surpassed Netflix in the US last year, according to Parks Associate, a consulting firm.
In November, Netflix introduced a streaming plan with advertising in 12 countries for $6.99 per month after years of resisting commercials. Hulu, Disney+, and HBO Max already have ad-supported options.