Netflix: The streaming company keeps its crown

10/18/22 8:00PM

Netflix's crown is intact

‍‍Netflix reported yesterday that they had added 2.4m new subscribers last quarter, confirming that they still wear The Crown in the streaming wars — for now at least.

The return to growth couldn’t have come quicker for Netflix after a terrible first half of 2022 in which the company lost almost 1.2 million subscribers. Big TV hits like Dahmer, Stranger Things and Cobra Kai — the latter of which was the most-watched show on any streaming service in mid-September — have pulled Netflix out of the red.

With consumers tightening their belts, and competition in streaming as intense as ever, Netflix execs were noticeably relieved with CEO Reed Hastings saying “thank God we’re done with shrinking quarters”. Investors are pleased too — Netflix shares are up 12% at the time of writing.

‍All-you-can-watch

‍Looking ahead, Hastings' confidence that Netflix will keep growing is probably well-judged — the launch of a cheaper ad-supported tier should drive new subscribers, as could a further crackdown on password sharing.

Interestingly, Netflix also reiterated that they would be doubling down on the "binge" release model — citing global hit Squid Game as a show that might not have gone as viral if not for the momentum created by people being able to watch episodes back-to-back-to-back.

Max Knoblauch14h

Paramount reportedly receives $24 billion from Gulf funds to back its Warner Bros. takeover

Three Middle East sovereign wealth funds have agreed to back Paramount’s takeover of Warner Bros. Discovery to the tune of roughly $24 billion, according to Wall Street Journal reporting.

The company’s triumph over Netflix in the bidding war came thanks in part to financial backing from Oracle cofounder Larry Ellison, billionaire father of Paramount CEO David Ellison.

Saudi Arabia’s PIF, which last year led the $55 billion deal to take Electronic Arts private, will provide about $10 billion in the deal. The Qatar Investment Authority and Abu Dhabi’s L’imad Holding Co. is also involved.

According to the WSJ, the funds will not receive voting rights in the combined Paramount-Warner company. Those working on the deal don’t expect the Gulf funds’ involvement to spark any additional regulatory reviews.

Exclusive | Gulf Funds Agree to Back Paramount’s $81 Billion Takeover of Warner

The company’s triumph over Netflix in the bidding war came thanks in part to financial backing from Oracle cofounder Larry Ellison, billionaire father of Paramount CEO David Ellison.

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JetBlue is raising its bag fees as fuel costs squeeze airlines

JetBlue will reportedly hike its bag fees, as the cost of jet fuel continues to climb amid the war in Iran. It’s the latest example of carriers finding ways to push rising costs onto travelers.

Last week, United Airlines CEO Scott Kirby said that if fuel prices remain elevated, fares would need to rise another 20% for his airline to break even this year.

As CNBC reported, when one airline raises fees, others tend to follow.

Earlier this month, JetBlue hiked its first-quarter outlook for operating revenue per seat mile to between 5% and 7%, saying that strong Q1 demand helped “partially offset additional expenses realized from operational disruptions and rising fuel costs.” Now, the carrier appears to be making moves to further boost revenue to offset those costs.

Earlier on Monday, JetBlue rival Alaska Air lowered its Q1 profit forecast. The refining margins for the carrier’s cheapest fuel option — sourced from Singapore and representing about 20% of Alaska’s overall supply — have spiked 400% since February.

JetBlue did not immediately respond to a request for comment.