Netflix’s global sensation Squid Game has helped attract more new customers than expected. The world’s largest streaming media service company said on Tuesday that it expects that by the end of this year, the huge lineup will further increase the number of registrations.

After a sharp slowdown in the first half of 2021, Netflix added 4.38 million subscribers globally from July to September, reaching 213.6 million. According to data from Refinitiv, Wall Street analysts had expected an increase of 3.86 million.

As COVID-19 keeps viewers at home, Netflix’s subscribers surged last year, but growth stagnated at the beginning of this year. At the same time, Walt Disney’s Disney+, AT&T’s HBO Max and other competitors also supported their products. Netflix blamed the earlier in part on the pandemic that caused production shutdowns and the scarcity of new shows.

Then, the Korean TV series “Squid Game” premiered on September 17, and in the first month became the most watched original series of the streaming service, which surprised executives. On Tuesday, Netflix said that “incredible” 142 million households have watched dark drama about people competing in a deadly competition to eliminate financial debt.

The series was produced with a relatively small budget and ranked top on the Netflix viewing list in 94 countries/regions. It drove the sales of sportswear and Vans sneakers, and ignited the interest in learning Korean. Squid Game products are now being sold to retailers For sale, Netflix said.

The enthusiasm of Squid Games is also expected to boost this quarter. Netflix is ​​expected to attract 8.5 million new customers by the end of the year, which is higher than the industry’s forecast of 8.33 million because it has released a large number of new shows. Upcoming movies include the big-budget action movie “Red Notice” and the second season of the fantasy drama “The Witcher”.

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The company stated in its quarterly letter to shareholders that it also expects to have more standardized programming in 2022, “assuming there is no new wave of COVID or unforeseen events.”

After the earnings report was released, Netflix’s stock price was also close to US$641 (approximately Rs 48,130) in after-hours trading.

Overseas growth

Most of the new customers this quarter came from the Asia-Pacific market, and Netflix now has 30 million subscribers. Industry experts believe that the region may be comparable to the United States and Canada (Netflix’s largest market) within three to five years, said Joe McCormack, senior analyst at Third Bridge.

Netflix is ​​trying new ways to attract overseas customers, including offering free plans in Kenya. The company said it will take one to two years to determine whether this strategy will bring more paying users.

In the quarter that ended in September, the diluted earnings per share was US$3.19 (approximately 240 rupees), which exceeded analysts’ expectations of US$2.57 (approximately 190 rupees). Revenue increased by 16% to 7.5 billion US dollars (approximately Rs 56,325 crore).

Before the earnings report was released, Netflix’s stock price had risen about 22% this year and was close to historical highs, but its gains lagging behind the 54% gain of the Nasdaq index.

Netflix keeps most of its ratings data confidential, and it also stated that it will release information more frequently and shift its main publicly reported indicator to watch time, rather than the number of accounts that watch titles for at least 2 minutes. The company noted that it competes with a large number of activities outside of TV, including TikTok and Fortnite. When Facebook suffered a global power outage in early October, “our participation increased by 14% during this period,” Netflix said.

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The executives did not resolve employee complaints about Dave Chappelle’s comedy special, which the company had previously defended. Some employees said that Chapel had made remarks harmful to transgender people, and they planned to strike on Wednesday.

© Thomson Reuters 2021


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