Netflix (NASDAQ:NFLX) will continue to crack down on password sharing in the United States and three other nations in the current quarter.
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According to the company, as people gradually began activating their personal accounts, the first quarter saw higher customer acquisition and revenue growth than the pre-launch period. After the launch, the number of paid subscribers rose, especially in Canada.
The rollout is part of Netflix’s efforts to reduce the number of free accounts shared among members of various households and increase its subscriber base. The business predicted that over 100 million households shared passwords in January.
During its Q1 earnings call, the company mentioned that it delayed further rollouts to streamline the procedure. It is noteworthy that Netflix began testing paid sharing in Latin America last year before expanding to Canada, New Zealand, Portugal, and Spain this year.
As a result of the delay, Netflix stated that it anticipates the membership growth and revenue gains from the launch to appear in the third quarter rather than in the second quarter.
Is NFLX a Buy or Sell?
Wall Street is cautiously optimistic about Netflix, with a Moderate Buy consensus rating based on 17 Buys, 15 Holds, and two Sells. The average price target of $362.37 suggests upside of 12.2%. The stock is up 9.6% so far in 2023.
