Stock in Netflix jumped $31.33, or 9.3 percent, to $371.29 after the streaming giant told the advertising world it had nearly 5 million monthly global active users for its new ad-supported video platform.
That share price rebound on Thursday amid a struggling TV advertising market followed just over a year ago when Netflix saw its stock price crater after disclosing a loss of paid subscribers for the first time in a decade. That event also rocked rival entertainment and streaming players like Disney, Warner Bros. Discovery, Paramount and Roku as the era of seemingly unstoppable growth for pricey subscription streaming platforms had ended.
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While not specifying how many actual subscribers it has for the new ad tier, this week’s announcement on monthly active users marked the first time Netflix revealed traffic figures for its advertising-supported tier that launched only six months ago. Wall Street investors, with a focus on profitability for content-hungry streaming platforms in an increasingly crowded and competitive landscape, have looked to Netflix’s new ad-supported option for signs of overall subscriber and churn trends and the company’s overarching financial outlook going forward.
No longer shunning advertising as subscriptions remain a key focus, Netflix participated in the TV upfronts week in New York City as it pitched ad buyers. Company execs revealed the overall ad member base had “more than doubled” since early this year. The streaming giant’s global subscriber total currently stands at 232.5 million.
Other metrics revealed at the upfront presentation include Netflix, as it competes with Hulu and Pluto TV in the ad space, reporting that over a quarter of new subscribers for the ad-supported option were signing up in markets where it’s available, indicating a strong take-up. And the median age for its ad-supported platform, which unlike rival streaming platforms is without marquee live sport programming, is 34.
Netflix also told ad buyers that viewers of the new tier were engaging with content at similar levels to that of standard tier users.
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