After struggling with subscriber losses earlier this year, Netflix claims to be winning the streaming wars after it gained 2.4 million subscribers between July and September 2022. That’s higher than the one million it had projected.

The streaming giant also said it expects revenues in the third quarter to reach $7.9bn.

In a letter to shareholders, Netflix claimed to be winning the streaming wars as viewers engage more with its content in the US and in the UK than rivals Amazon and Disney+.

“Our competitors are investing heavily to drive subscribers and engagement, but building a large, successful streaming business is hard – we estimate they are all losing money, with combined 2022 operating losses well over $10bn, vs. Netflix’s [$5bn] to $6bn annual operating profit,” the company said.

It is a surprising turn in Netflix’s fortunes, which has previously been said to be losing its status as top dog in streaming.

“Netflix’s surprise subscription growth has truly stolen the show,” Sophie Lund-Yates, lead equity analyst at financial service company Hargreaves Lansdown, tells Verdict. “Markets were braced for a measlier set of results, but strong content from The Jeffrey Dahmer Story and Stranger Things appears to have convinced people to stick with the platform and entice newbies.”

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However, market watchers believe it’s too early for Netflix’s leadership to relax.

“Despite largely positive earnings, Netflix is still looking over its shoulder at streaming war rivals,” Francesca Gregory, analyst at GlobalData, tells Verdict.

“Netflix announced it won’t share subscriber growth forecasts from Q1 2023. This is a bid to change metrics of streaming success towards revenues while Disney- and Amazon overspend to get subscribers.”

The imminent launch of Netflix’s ad-supported tier also grabbed some attention from market watchers.

“It’s a new era of competition in streaming and the race is on to create the right offer, for the right subscriber, at the right time,” Tien Tzuo, CEO and founder of subscription management company Zuora, tells Verdict.

“Netflix’s new ad-tier is a good start, but they still have to work at being nimbler and more dynamic with packaging and bundling to continue competing with the likes of Disney and HBO.”

GlobalData is the parent company of Verdict and its sister publications.