LOS GATOS, Calif. — Netflix correctly predicted an increase in revenue and accounts coming from its clamp down on password sharing.
According to research firm Antenna, California-based Netflix has experienced a significant surge in daily sign-ups for its U.S. service since implementing stricter measures last month.
Some 100,000 new sign-ins were recorded over a span of just two days, data shows.
Starting from May 23, Netflix implemented new rules wherein U.S. users are required to pay an additional $8 per month to add a non-household member to their accounts. This marks a notable shift in strategy for a company that once espoused the sentiment of password-sharing as an act of love.
After implementing this change, Netflix observed its four largest days of U.S. subscriber growth in the past four and a half years, as tracked by Antenna.
“Average daily Sign-ups to Netflix reached 73k during that period, a +102% increase from the prior 60-day average. These exceed the spikes in Sign-ups Antenna observed during the initial U.S. Covid-19 lockdowns in March and April 2020,” said Antenna in statement on Twitter.
This trend is a positive sign for Netflix considering, earlier this year, observers anticipated mounting challenges for the entire streaming industry.
Entertainment data firm Parrot Analytics, for example, said the increasingly saturated market would hurt global demand, especially among recession-minded subscribers.
But almost 80% of people in the U.S. already pay for at least one streaming service, Bloomberg reported, calling Netflix and Disney the two largest streaming platforms available. Amazon’s Prime Video, Hulu, and HBO Max are among the so-called “big five,” but there are currently more than 200 streaming services.
Notably, the spike in Netflix sign-ups even surpassed the surge witnessed during the initial lockdown period in the U.S. between March and April 2020.
The positive momentum generated by Netflix’s crackdown on password-sharing has also translated into a boost for the company’s stock, especially on Friday.
“These exceed the spikes in sign-ups Antenna observed during the initial US Covid-19 lockdowns in March and April 2020,” the firm said in a report. It also noted that “cancels also increased during this period, but not as much as sign-ups.”
Netflix was trading at $417.52 per share at last check on Monday. That’s down 0.6%. The stock was still below its pre-inflation shock high of about $692 seen on Nov. 17, 2021, but above the low of $167 from mid-June 2022.
Produced in association with Benzinga
Edited by Daisy Atino and Alberto Arellano