SUMMARY
The streaming giant’s revenue grew 24% INR 2,214 Cr in FY23 from INR 1,784 Cr in FY22
Total expenses rose 23.9% to INR 2,232.5 Cr in FY23 from INR 1,802 Cr in FY22
The increase in revenue and profit comes at a time when Netflix is aggressively promoting its lower-priced subscription plan to grow its user base in India
Streaming giant Netflix’s India arm, Netflix Entertainment Services India LLP, saw its net profit surge 75% to INR 35 Cr in the financial year 2022-23 (FY23) from INR 20.13 Cr in FY22.
The OTT platform, which competes with the likes of Amazon Prime Video, Disney+ Hotstar, and JioCinema, saw its operating revenue grow 24% to INR 2,214 Cr during the year under review from INR 1,784 Cr in FY22, likely on the back of subscriber additions, according to its regulatory filings with the Registrar of Companies (RoC), sourced from PrivateCircle Research.
The increase in revenue comes at a time when Disney is in talks with Reliance Industries for a merger, which will create a streaming behemoth and pose a strong challenge to Netflix.
Including other income, Netflix’s Indian arm saw its total income grow 24.4% to INR 2,286.3 Cr in FY23 from INR 1,837 Cr in the previous fiscal year.
Where Did Netflix Spend?
The company’s total expenses rose 23.9% to INR 2,232.5 Cr in FY23 from INR 1,802 Cr in FY22.
Personnel expenses zoomed 29.2% to INR 124.6 Cr in FY23 from INR 96.4 Cr in FY22. Meanwhile, other expenses increased 24% to INR 2,062 Cr in FY23 from INR 1,667 Cr in FY22. However, the company did not give the breakup of other expenses.
The increase in Netflix’s revenue and profit in India comes after the streaming giant reduced the prices of its subscription plan in December 2021, resulting in improved customer engagement and higher subscriber numbers in 2022.
Last year, Netflix co-CEO Ted Sarandos emphasised the significance of India as a “big prize” due to its vast population of entertainment enthusiasts. He expressed confidence that Netflix would ultimately thrive in the country.
“When we get the pricing a little better and more suited to the market, you can see that we can grow revenue and engagement. We have to get the content that people just really flip out for. We have seen a steady improvement in that quarter-over-quarter, both in our films and our series,” Sarandos said.
Netflix also ended password sharing globally in 2023, including in India. Simultaneously, it also started aggressively promoting its INR 149 per month mobile-only plan to boost subscriber numbers in India.
India’s video industry, which includes TV and digital, reached a valuation of $13 Bn in 2023, making it the third-largest in the Asia-Pacific (APAC) region, behind China and Japan, according to a report by consulting firm Media Partners Asia Research (MPA).
It further said that India’s video market is projected to grow at a CAGR of 5.6% from 2023 to 2028, reaching a revenue of $17 Bn by 2028.
