Netflix added an estimated 10.4 million subscribers globally in the fourth quarter, up from a previous estimate of 9.5 million subs, according to new data estimates from Wells Fargo Securities.
Netflix reports fourth-quarter results on Jan. 23.
Analyst Steve Cahall believes Netflix’s aggressive move to stop people freeloading on existing subscribers through unauthorized password sharing could drive ad-supported subscriber growth of around 4.2 million subs, exceeding estimates of 3.9 million subs through the first quarter, ended March 31.
Netflix, which said about 100 million subscribers globally were sharing their passwords with non-paying users, notified members of the situation, offering unauthorized users the option to share an existing standard account for a $7.99 monthly fee, or get their own account. Premium subs can share up to two accounts, each for the aforementioned fee.
While some freeloaders have opted to share an existing account, the majority have opted for Netflix’s $6.99 ad-supported plan.
Through the second half of the year, Netflix sub growth is projected to cool to 3.8 million from 7.3 million in the previous-year period, according to Wells Fargo. Total 2024 subscriber growth is projected to be around 19.5 million, which is 2.5 million subs below the analyst’s previous estimate of around 22 million. Wall Street is reportedly projecting 2024 sub growth of around 17.5 million.