Netflix is planning to implement extensive budget cuts in 2023 in order to make the streaming service more profitable. In order to increase profits, Netflix announced a password-sharing crackdown would make its way to the US in Quarter 2 after being tested in some international markets earlier this year.
Now, The Wall Street Journal reports Netflix is planning to cut their spending by $300 million in 2023 to ensure more profitability. Netflix’s decision is partially influenced by their movement of US password-sharing crackdowns from Q1 to Q2. While there will be no freeze on hiring nor any layoffs, staffers are expected to spend money wisely as the cost-cutting commences.
What Budget Cuts Mean For Netflix In 2023
Netflix lost almost 1 million subscribers in the first half of 2022, a first for the streaming giant. While these losses are small against the estimated 220 million subscribers they have worldwide, Netflix’s recent actions toward password sharing signal the streamer still wants to see subscriptions increase. Their pursuit of cost-cutting also underscores how more spending on original shows and movies like The Night Agent or The Mother have reduced Netflix’s profitability.
With Netflix seeking to cut down on spending this year, the platform will likely have to limit the number of new original movies and series they produce. Additionally, Netflix could reduce spending for original series and films in production, such as the live-action One Piece or The Three-Body Problem. It may also result in projects being axed if Netflix deems them unprofitable and better off canceled for the sake of spending less.
Netflix is already facing scrutiny for canceled series like Warrior Nun, such as when Netflix subscribers blasted the streamer after they posted an Instagram story mocking users who want their favorite shows renewed. Cutting costs could anger more subscribers if that cost-cutting comes in the form of cancelations. Even so, it appears Netflix‘s primary goal is ensuring streaming profitability, which may only be possible by cutting down on spending.
Source: The Wall Street Journal
