Question 1

Is Netflix still growing in its home market?

Accepted Answer

US growth is slowing, with 0.9m net adds in 3Q falling short of the 1.1m forecast due to technical friction from chip-based credit card transitions. However, the domestic base remains substantial at 43m users, representing the majority of the 69m total global subscribers.

Question 2

How is the international expansion performing against expectations?

Accepted Answer

International markets are outperforming guidance, delivering 2.7m net adds against a predicted 2.4m. This momentum is driven by the recent Japanese launch and rapid adoption in Australia and New Zealand, bringing the total international subscriber base to 26m.

Question 3

Can Netflix successfully raise prices without losing customers?

Accepted Answer

The company is aggressively testing pricing power by increasing the monthly rate to US$9.99 for new customers in the US, Canada, and Latin America. Despite these hikes, Netflix added 3.62m total subscribers this quarter, indicating that original content investment is effectively insulating the brand from churn.

Question 4

What is the outlook for the Australian streaming market?

Accepted Answer

Netflix has achieved rapid penetration in Australia, reaching 1m paid subscribers which equates to 1 in 10 households. This growth is fueling a massive increase in local content spend, with xVOD investment estimated to reach A$424m by FY20.

FLASH – Netflix 3Q: Content will drive growth

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