Netflix earned a net income of $1.7 billion on revenues of $7.3 billion in the quarter ending June 30, and it now has over 209 million paid subscribers.
“COVID has created some lumpiness in our membership growth—higher growth in 2020, slower growth this year—which is working its way through [our financial results],” the firm wrote in a letter to shareholders. “We continue to focus on improving our service for our members and bringing them the best stories from around the world.”
Netflix is still the go-to video streaming service worldwide, but it has seen increased competition from newer services like Disney+ and HBO Max. Still, Netflix says it has plenty of room to grow, since streaming represents just 27 percent of total screen time in the U.S., compared to 63 percent for “linear TV,” and Netflix is just 7 percent of that former figure. That’s better than YouTube and YouTube TV (6 percent), Hulu (3 percent), Prime Video (2 percent), and Disney+ (2 percent), according to Nielsen.
Netflix added 1.5 million new subscribers in the second quarter of 2021, ahead of projections. And it plans to add another 3.5 million subscribers in the current quarter, lower than the 5.5 million predicted by investors. And CEO Reed Hastings says that newer competitors haven’t hurt it at all so far.
“We’ve been competing with Amazon Prime for 13 years, with Hulu for 14 years,” he said. “It’s always been very competitive with linear TV, too. So there’s no real change that we can detect in the competitive environment.”
As for its plans for video games, Netflix says that it will start with mobile games first and that games will be part of existing subscription tiers and not a new offering.
“We’re in the early stages of further expanding into games, building on our earlier efforts around interactivity—e.g. Black Mirror Bandersnatch—and our Stranger Things games. We view gaming as another new content category for us, similar to our expansion into original films, animation, and unscripted TV. Games will be included in members’ Netflix subscription at no additional cost similar to films and series. Initially, we’ll be primarily focused on games for mobile devices … Since we are nearly a decade into our push into original programming, we think the time is right to learn more about how our members value games.”