Netflix, announces Q1 ‘2022 results, forecasts revenue growth of 9.7% in Q2

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Netflix said that their 10% revenue growth in Q1’22 was driven by an 8% year over year increase in average streaming paid memberships and 2% year over year growth in ARM (Average Revenue per Membership). 

With an increase of $144 million, the OTT giant generated $923 million net cash in Q1 which was $777 million in the Q1’21. While the Free Cash Flow amounted to $802 million all increased from $692 million in the prior period. On this, Netflix said, ‘We continue to expect to be free cash 3 flow positive for the full year 2022 and beyond.’

Our plan is to reaccelerate our viewing and revenue growth by continuing to improve all aspects of Netflix – in particular the quality of our programming and recommendations, which is what our members value most.

-Netflix

Netflix projects revenue to grow approximately 10% year over year in Q2, assuming roughly a mid-to-high single digit year over year increase in ARM on a F/X neutral basis.

The company said that on the content side, they are doubling down on story development and creative excellence, which they see reflected in big Q1’22 TV hits like Bridgerton (627 million hours) and Inventing Anna (512m hours viewed) and films like Tinder Swindler (166m hours viewed, our biggest documentary film ever released) and The Adam Project (233m hours viewed).

Netflix Q1’22 Financial Report (Image Credit: Netflix)

Netflix, on the product side has recently launched “double thumbs up” so members can better express what they truly love versus simply like. The move is enabling the platform to continue to improve their personalized recommendations and overall experience. 

The company also talked about its two acquisitions, Scanline and gaming studio Boss Fight Entertainment. Netflix said that the two acquisitions had a -$125 million impact on cash. The OTT giant has already announced the purchase of Helsinki-based gaming company Next Games and expects the transaction to be completed in the second half of 2022.

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