Netflix (NFLX) freeloaders, beware! The company is ramping up its password sharing crackdown.
Following fourth quarter earnings results on Thursday that saw subscriber numbers leap past expectations, the company warned in its quarterly letter to shareholders it will be intensifying its push to combat password sharing.
"Later in Q1, we expect to start rolling out paid sharing more broadly. Today’s widespread account sharing (100M+ households) undermines our long term ability to invest in and improve Netflix, as well as build our business," Netflix said.
The company explained it's been building additional new features to improve the overall Netflix experience, including the ability for members to review which devices are using their account and to transfer a profile to a new account.
Members can also pay extra if they want to share the platform with people they don't live with.
"As we work through this transition – and as some borrowers stop watching either because they don’t convert to extra members or full paying accounts – near term engagement, as measured by third parties like Nielsen’s The Gauge, could be negatively impacted," Netflix said.
However, the company referred to its recent testing in Latin America, which showed engagement steadily increase over time as borrowers signed up for their own accounts and new content was released.
Investors will be closely monitoring the company's earnings call for additional updates regarding its crackdown on password sharing, in addition to its newly launched ad-supported tier.
Netflix has looked at those two initiatives as profitability drivers, especially as competition within the streaming space escalates: "As always, our north stars remain pleasing our members and building even greater profitability over time," the streamer said.
Quarterly net additions grew by 7.66 million, above company guidance of 4.5 million amid a slew of high-profile and record-breaking content releases, including "Glass Onion," "Troll," "All Quiet on the Western Front," "My Name is Vendetta," and "Wednesday."
The company reported revenue and earnings per share for the fourth quarter that were light of estimates, as revenue totaled $7.85 billion against forecasts for $7.86 billion, while earnings per share came in at $0.12 against $0.58 expected.
For the current quarter, Netflix expects revenues will total $8.17 billion with earnings per share forecast to total $2.82. Netflix no longer offers subscriber growth forecasts.
The company also announced co-CEO and co-founder Reed Hastings would step down from his role leading the company, with COO Greg Peters will join current Netflix co-CEO Ted Sarandos in that role. Hastings will now serve as the company's executive chairman.
Shares of Netflix were up as much as 6% in after-hours trading following Thursday's results.
Netflix stock have been on a tear in recent weeks, up roughly 60% over the past six months with about a 10% gain so far in January, outperforming the Nasdaq Composite's 5% gain.
Alexandra is a Senior Entertainment and Media Reporter at Yahoo Finance. Follow her on Twitter @alliecanal8193 and email her at alexandra.canal@yahoofinance.com
Click here for the latest trending stock tickers of the Yahoo Finance platform
Click here for the latest stock market news and in-depth analysis, including events that move stocks
Read the latest financial and business news from Yahoo Finance
Download the Yahoo Finance app for Apple or Android
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and YouTube
Related Quotes
Netflix said it is planning to step up its crackdown on password sharing, which has cost the streaming service provider billions in revenue each year. "Today's widespread account sharing (100M plus households) undermines our long-term ability to invest in and improve Netflix, as well as build our businesses," the company said. "While our terms of use limit use of Netflix to a household, we recognize this is a change from members who share their account more broadly."
Profit from folly. Don’t participate in it.
Should investors be excited or worried when a stock's 50 -day simple moving average crosses above the 200-day simple moving average?
Nvidia is a giant in data centers and gaming, but semiconductor companies are bracing for a bumpy 2023. Is Nvidia stock a buy right now? Recently, World Semiconductor Trade Statistics predicted that chip sales will decline 4.1% in 2023.
The S&P 500 dipped by 19% in 2022, but stocks still don’t seem cheap to Charlie Munger, Warren Buffett’s billionaire partner at Berkshire Hathaway. “In my whole adult life, I have never hoarded cash, waiting for better conditions,” Munger said in an interview in late 2022. “I’ve just invested in the best thing I could find.” Yet he acknowledged that Berkshire Hathaway is sitting on billions of dollars in cash. The reason isn’t that Buffett and Munger think they can wait for stocks to get even ch
Chinese stocks rebounded with Covid curbs easing, but soaring infections are a concern. E-commerce, solar and EV stocks are among the 5 best.
Cathie Wood's ARK Innovation ETF is back — and back big. It's the top diversified ETF again this year so far, largely due to big winners.
A peak-to-trough drop of 38% in the Nasdaq Composite is the perfect excuse to scoop up these high-growth bargains.
There are financial technology companies that are bringing innovation to consumers, but tougher credit markets have hurt their businesses. This could be an opportunity for long-term investors; these three stocks are poised to flourish when economic conditions ease up, so consider them before the bear market ends. Rapidly rising interest rates created two problems for Upstart Holdings (NASDAQ: UPST), which uses artificial intelligence to replace the traditional FICO credit score in approving consumer loans.
(Bloomberg) — US technology stocks are about to hit their next hurdle when earnings season for the most influential segment of the S&P 500 Index gets underway in the coming week: vanishing profits. Most Read from BloombergHolmes Belongs in Prison, Not $13,000-a-Month Manor, US SaysJPMorgan Model Shows Recession Odds Fall Sharply Across MarketsGoogle to Cut 12,000 Jobs in 6% Reduction of Global WorkforceBeyonce Launches $100,000-a-Night Dubai Resort’s Luxury BetMilan Luxury Real Estate Booms as
Ross Gerber and Jim Chanos debated the merits of the company as an investment at a Wall Street Journal event on Friday.
No company is certain to avoid significant cutbacks in an economic environment as volatile as the current one, and Apple isn’t immune to the business challenges that have hit other tech giants. It is expected next month to report its first quarterly sales decline in more than three years. Apple has also slowed hiring in some areas.
Finding young and growing tech stocks is crucial to any investor's portfolio. The explosive returns these investments can have on a portfolio can accelerate your financial goals faster than nearly any other investment — if purchased for the right price. Unfortunately, many investors found themselves on the wrong side of this coin during 2021, as many growth names were unrealistically valued.
The precious metal’s revival could signal a rekindling of inflation—and bad news for stocks and bonds. It’s doing something it hasn’t done in a half-century.
In this article, we take a look at 15 stocks that have increased their dividends for over 25 years. If you want to see more stocks that have increased their dividends for over 25 years, go directly to 5 Stocks That Have Increased Their Dividends for Over 25 Years. In addition to buybacks, dividends are […]
Precious metals expert predicts gold and silver will rise in 2023 as government spending results in increased inflation and U.S. hits debt ceiling.
California's proposed wealth tax appears to take aim at popular strategies among the wealthy to avoid state taxes.
Yahoo Finance Live anchors Seana Smith and Dave Briggs look ahead to the tech stock earnings due out next week.
Bed Bath & Beyond is facing another critical challenge: staying listed on the Nasdaq Stock Market.
It looks like Pfizer Inc. ( NYSE:PFE ) is about to go ex-dividend in the next 4 days. The ex-dividend date is one…
Netflix: Password sharing 'undermines' business, warns crackdown will intensify – Yahoo Finance
