Netflix on Thursday said it added more than five million subscribers in the recently ended quarter but signaled slowing growth.
The streaming juggernaut said it ended September with 282.7 million subscribers, reporting a profit of $2.4 billion on revenue that jumped 15 percent to $9.8 billion compared with the same period a year earlier.
Netflix said it continued to build up its US advertising business, which is on track to launch in Canada by the end of this year and in other countries in 2025.
“We’ve delivered on our plan to reaccelerate our business, and we’re excited to finish the year strong with a great slate (of shows),” the streaming television powerhouse said in a letter to investors.
Shows set for release at Netflix this quarter include a second season of global hit “Squid Game.”
The dystopian Korean horror tale about a fictional, deadly game show remains by far the most-watched Netflix TV series ever.
Netflix this quarter will also stream a boxing match-up between Mike Tyson and Jake Paul as well as a pair of US National Football League games on Christmas.
The streamer said that membership on the ads plan grew 35 percent quarter-over-quarter and accounted for over half of sign-ups in countries where it’s available.
Emarketer senior analyst Ross Benes warned that Netflix will need to be careful not to degrade the experience for viewers as it weaves ads into programming, and forecast that US ad revenue would be a small fraction of the money the company takes in.
Netflix said the average amount of time spent watching its platform grew in the recently-ended quarter, touting a string of hits including “The Perfect Couple”, “Emily in Paris”, and “Beverly Hills Cop: Axel F”.
In a bid to boost sputtering growth, the company launched an ad-subsidized offering last year around the same time as a crackdown on sharing passwords.
As part of that effort, Netflix also got rid of its cheapest commercial-free plan in the UK and Canada, with expectations of further expansions of the policy.
In the United States, the company has begun to offer some users combined packages with its one-time rivals, making itself available through joint subscriptions with Peacock and Apple TV.
The company also launched an in-house advertising platform so that brands can better optimize its customer data, no longer partnering with Microsoft for that technology.
Investors have cheered on the moves, with Netflix shares gaining ground this year — though it has warned that growth in overall subscribers could slow.
Netflix is seen as reigning supreme over the video content market, with Disney+ still struggling nearly five years after a launch that featured a slew of new content from its blockbuster Marvel and Star Wars universes.
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