Netflix added over 8 million subscribers in the second quarter of 2024, beating expectations, taking its global total to 277.65 million, up by nearly 40 million in a year. While other online competitors are jostling for position in what many expect will become a bundle of services, Netflix seems to believe that it stands alone with the strength of its offering, but its advertising business remains nascent.
The quarterly subscriber gain was lower than in the first quarter, when Netflix added 9.33 million, or the last quarter of 2023, when it gained 13.12 million.
The greatest gains were in the Asia Pacific region, up by 2.83 million, followed by Europe Middle East and Africa at 2.24 million, Latin America at 1.53 million, and the United States and Canada at 1.45 million.
Quarterly revenue was correspondingly up by 16.8% to just under $9.6 billion, with net income of $2.15 billion.
Although some operators may include Netflix in a bundle with other services, Netflix says that it has not bundled its service with other services like Disney+ or Max “because Netflix already operates as a go-to destination for entertainment thanks to the breadth and variety of our slate and superior product experience.”
Netflix is working on a new television home page design, which it says is its biggest update in a decade, with more immersive trailers and bigger box art. The navigation bar is simplified and moved to the top of the screen. So all those applications that flattered Netflix by imitating its previous design may now want to reconsider.
The number of accounts taking the advertising tier grew by 34% over the quarter. It now accounts for over 45% of all new signups in markets where it is available. However, Netflix has not disclosed absolute numbers.
Having launched its advertising with Microsoft, Netflix is building an in-house advertising technology platform that it will test in Canada before launching more widely in 2025.
In the United Kingdom, audience measurement organisation Barb will report on the Netflix advertising supported plan from September.
Although it says advertising will be a key component of its longer-term revenue and profit growth, Netflix says “we don’t expect advertising to be a primary driver of our revenue growth in 2024 or 2025”. Spencer Neumann, the chief financial officer, told analysts that “when you get into ’26 and beyond, it can be even more meaningful and hopefully, it becomes the point where it is a primary contributor, given all of that engagement and reach that we’re building.”