a record 29 million more subscribers in a year for Netflix

This is a record for Netflix, which presented its annual results late last week: the leader in the video subscription has attracted 29 million new subscribers in fiscal 2018. This brings the total of its paying subscribers to 139 million (It no longer counts subscribers in free trial period).

Usually stingy with numbers, Netflix has also said that now weigh 10% of the time spent by the Americans in front of the television, knowing that it is watched mainly on the traditional small screen. That's a lot for a young paid service, but this figure is also interpreted as Netflix's desire to show that it still has room for improvement.

The audience data revealed Thursday by the group may in any case to challenge directors and actors anxious to reach the largest audience possible. The movie "Bird Box", with Sandra Bullock, would have been watched by 80 million households in four weeks after its release, according to Netflix.

The latter believes in his letter to the shareholders that the success of his films "Begins to replicate" that of his series. It does not fail to mention the prestigious "Roma", a feature film shot in Spanish and which won the Golden Lion at the Venice Film Festival.

The series "Sex Education" and "You", recently launched, should affect more than 40 million homes for a similar duration (the count starts from an episode seen at 70%). Netflix also wants to show that it can travel non-English content around the world. The Italian series "Baby" and Turkish "The Protector" have been seen by more than 10 million homes, "Elite" (Spain) by more than 20 million.

80 million for "Bird Box"

Netflix, however, has misused the markets: with revenue growth consistently higher than 30% from one quarter to another, the streaming specialist is liable to regularly disappoint.

The company, which released its results for the last quarter of 2018 on Thursday night, posted lower than expected revenue, up 27 percent to $ 4.1 billion. Netflix discusses negative exchange rate impacts and warns that revenue growth will be slower than expected in the first quarter of 2019, at 21%.

Friday, the title was down 3.5% in the first trade, after having risen a lot this week following the announcement of a price increase in the United States.

Subscribers record

The streaming service, however, captured 8.8 million new subscribers in the last quarter, 34% more than a year earlier, and more than analysts and he expected. Of this total, 7.3 million are based outside the United States, confirming the rapid development of the company outside its home market. In the United States, however, it has won 1.5 million additional subscribers. It still expects an additional 8.9 million subscribers in the first quarter of 2019.

The company's large investments in content development weighed on profits, which fell by 28% to $ 134 million.

A pioneer of streaming, Netflix is ​​forced to invest more and more in the creation of exclusive content to counter the growing competition from media groups that launch or will launch one after the other their own streaming channels, such as Amazon, Hulu, Disney, HBO or Warner Media. The pressure is all the stronger as the latter at the same time review the contracts for the distribution of their content, to reserve them for their own channels. Disney plans to keep some of the production for its channel, and WarnerMedia recover the series "Friends", now on Netflix.

Improvement of cash flow from 2020

In this context, Netflix announced this week to increase the price of its subscriptions: the cheapest package will increase from 8 to 9 dollars per month, and the most popular, which allows access to two screens at the same time, will increase from 11 to $ 13. A decision that should allow him to keep the financial means to develop exclusive content. Analysts estimate that Netflix will spend about $ 12 billion in content this year, twice as much as in 2017.

The group does not yet intend to reduce its liquidity and considers that it can continue to solicit investors to raise additional money. The idea is to get ahead of the competition with attractive content and its consumption of "cash" - a key indicator for this growing business - will remain around $ 3 billion this year, as in 2018 The group promises however that it will be less greedy in liquidity from next year.

Elsa Conesa

Nicolas Madelaine