Netflix (Finally) Shows Streamers How It’s Done

After a rough go in 2022, Netflix’s big decision is paying off... [Derby City Daily logo]( [Derby City Daily logo]( March 19, 2024 [Netflix (Finally) Shows Streamers How It’s Done]( By Andy Swan Historically, companies at inflection points have either soared to new heights or faltered. In 2004, Blockbuster operated over 9,000 stores. But by refusing to adapt to the rise of digital streaming services, the former titan of video eventually sank into irrelevance. At the same critical juncture where Blockbuster failed, Netflix (NFLX) made a very different choice – pivoting its DVD-by-mail business to streaming and video on demand in 2007. Fast forward to today, and streaming isn’t just the norm – it's a [global powerhouse industry]( worth $544 billion. Netflix made the right decision. 99% of American households subscribe to at least one streaming service, of which there are [hundreds of options](. Yet Netflix still reigns supreme with 260.28 million subscribers worldwide as of December 31, 2023 – the most of any other service by far. But there was another, much more recent, make-or-break moment that got Netflix to this point. See, not long ago, in 2022, Netflix was bleeding subscribers; its stock had plummeted to under $300 a share. After years of rejecting [advertisements]( on its platform, the company pivoted... and just in time. RECOMMENDED LINK [The Convergence of A.I. and Crypto Is Going to Create Generational Wealth]( Legendary crypto investor Charlie Shrem, who bought Bitcoin back when it was just $5, believes A.I. is going to be the biggest winner of the 2024 crypto bull run. When you combine A.I. and crypto — the two biggest technologies of our generation... Early adopters could see 10X, 50X, or even 100X over the next 12 months. [Click here to discover the top 5 A.I. cryptos for 2024]( How Ads Saved Netflix Netflix rolled out its lower cost “Basic with Ads” tier for $6.99 in the U.S. in November 2022, and you can see the immediate return on that investment on the chart below: The ad-supported tier significantly contributed to Netflix's revenue in the most recent quarter, marking a 12.5% increase in sales to $8.83 billion in Q4 of 2023. This tier accounted for 40% of all Netflix signups in the markets where it was offered. And LikeFolio data confirms continued traction in NFLX’s ad supported level. While generic mentions of new Netflix subscriptions have risen by 2% year over year among English speakers, those talking about signing up for the ad-supported model specifically have surged as much as 47% from the year prior. This is helping to lift NFLX above [peers like Hulu and Disney+ (DIS)]( even though the company already held significant market share. LikeFolio web metrics show this expansion in action for Netflix, with visits growing 5% year over year on a 30-day moving average – while those competing services record declines: To be clear: Disney is aware it has catching up to do on the streaming front – and has [big plans]( to get there. In fact, Disney CEO Bob Iger looks to Netflix as the “gold standard” in streaming technology. And for good reason... RECOMMENDED LINK [Quantum Cash: Louis Navellier’s Next Big Breakthrough]( He found Apple in 1988... Cisco in 1992... Oracle in 1990... but on Feb. 1st, he jumped on camera and revealed the biggest breakthrough of his career... A cash-generating system poised to deliver at least $60,000 in payable income opportunities over the next 12 months. [Go here]( now to see this shocking story. Wall Street Is Onto Netflix’s Success Netflix received a slew of upgrades this month as analysts realized that the ad-tier isn’t just driving growth – it's become an effective anti-churn mechanism. We’ll be listening to what consumers are saying in real time to confirm if this is, in fact, the case. But so far, Netflix looks like a beautiful case study on how to turn a business around. Shares have more than doubled over the last year, and are climbing back toward their COVID-era highs... so we expect continued overperformance from this stock in 2024. Netflix is the clear leader in the $544 billion streaming industry. But we're always looking toward what comes next – because that’s where our real edge lies. With a direct line to Main Street, [we can show you]( an up-and-comer that’s harnessing the power of AI to deliver an unbeatable streaming experience. [This player]( is handily beating Netflix in Consumer Happiness – by nearly 10 points. That’s a fantastic indicator of future growth. And Wall Street hasn’t even caught on yet. [Check it out](. Until next time, [Andy Swan's signature] [Andy Swan's signature] Andy Swan Founder, LikeFolio Discover More Free Insights from Derby City Daily Here's what you may have missed from Derby City Daily this week... ✓ [This Beauty Stock Is Sitting Pretty]( ✓ [8 Genius Ways Costco Stays on Top]( ✓ [Tesla Is Playing the Long Game. You Should, Too](. Get Instant Access Click to read these free reports and automatically sign up for research throughout the week. [The Infinite Income Manifesto]( [25 Doomed Blue Chip Stocks]( [5 Unapologetically Profitable Stocks for 2024]( © 2024 TradeSmith, LLC t/a Derby City Insights. All Rights Reserved. 1125 N. Charles Street, Baltimore, MD 21201 To unsubscribe or change your email preferences, please [click here](. [Terms of Use]( | [Privacy Policy](