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Netflix password crackdown drives up subscriber numbers

The streaming giant added a further 9.3m users in the first three months of the year, boosted by programmes such as The Gentleman
The streaming giant added a further 9.3m users in the first three months of the year, boosted by programmes such as The Gentleman - Christopher Rafael/Netflix

Netflix has enjoyed its strongest start to the year since 2020 as its password sharing crackdown boosted subscriber numbers.

The streaming giant added a further 9.3m users in the first three months of the year, boosted by original hits such as Harlan Coben adaptation Fool Me Once and Guy Ritchie’s The Gentlemen.

That compares to just 1.75m new subscribers in the same period last year, as the latest figures came in well ahead of analyst forecasts.

Netflix’s total subscriber base now stands at just under 270m.

The figures underscore Netflix’s dominance in the streaming sector after the company previously added a record 13m new subscribers in the final quarter of 2023.

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The California-based company has overhauled the business amid rising inflation and a deepening cost-of-living crisis, delivering its strongest growth since Covid lockdowns.

Improvements in performance has stemmed from its crackdown on password sharing, which has helped boost subscriber growth, as well the launch of an ad-funded tier in late 2022.

The company also raised prices for customers late last year.

In a letter to shareholders, Netflix said: “With more than two people per household on average, we have an audience of over half a billion people.

“No entertainment company has ever programmed at this scale and with this ambition before.”

Netflix has adopted a renewed emphasis on profits after years of focusing on subscribers amid tough competition from its rivals.

The company posted net profits of $2.3bn, a sharp increase on the $1.3bn profit posted in the same quarter last year. Revenues rose to $9.3bn.

However, Netflix’s forecasts for second-quarter revenues were slightly below market expectations, sending shares down around 5pc.

Netflix’s recent success has come amid troubles at rival Disney, which is battling to turn its fortunes around and was recently forced to fend off a proxy battle by activist investor Nelson Peltz.

Disney+ lost 1.3m subscribers at the end of last year, though the media giant narrowed its streaming losses by $300m in the quarter.

Netflix is now looking to expand into new areas such as live events in a bid to cement its dominance in the streaming age.

In January, it signed a $5bn deal to stream WWE’s flagship wrestling show Raw, marking the first time in more than three decades that the programme will not be broadcast live on a traditional TV channel.