Netflix set for slowest revenue growth as advertising plan struggles to gain traction

Netflix set for slowest revenue growth as advertising plan struggles to gain traction

1 minute, 3 seconds Read

“When debt was cheap, you could go and borrow a lot of money and invest it in content,” said Shahid Khan, partner and global head of media and entertainment at Arthur D Little.

“Given current interest rates, Netflix will have to be very selective about what green-lighting content and how they finance it.”

For comparison, rival The Walt Disney Company expects content spending in the range of at least $30 billion in fiscal 2023, while Paramount Global projects less than $10 billion. Disney does not split content expenses between Streaming and its other divisions.

Netflix had suffered huge subscriber losses in the first six months of 2022 due to the Russia-Ukraine conflict and a weak economy, forcing the streaming pioneer to turn to advertising in a move it has long resisted.

It returned to subscriber growth in the third quarter, but its stock, an investor favorite during its years of rapid growth, still ended the year down more than 50%.

The company’s revenue is expected to rise just 1.7% to $7.84 billion in the October-December quarter, according to Refinitiv. That would be the lowest it has been since going public in 2002.

“As overall streaming growth has decelerated, most mature streaming platforms have taken off as well,” MoffettNathanson said, adding that Netflix’s reach fell 200 basis points in the quarter.

291 Total Views 1 Views Today
Spread the love

Similar Posts