Netflix Q3 results: India adds to APAC growth with local content surge

Netflix's Q3 2024 earnings communicated to shareholders on October 17 revealed a promising growth for the streaming giant, especially in the Asia-Pacific (APAC) region, which includes key markets like India. 

The streaming giant reported a 15% year-over-year revenue growth globally, with APAC standing out as its fastest-growing region, boasting a 19% increase in revenue. This surge highlights the growing influence of markets like India, for which no separate data is available, on the streaming platform's overall performance.

India plays a critical role in Netflix's APAC expansion strategy, and Q3 2024 results underscore this importance.

The streaming platform has an audience base of over 600 million globally. Paid memberships in the APAC region increased to 52.6 million in Q3FY2024, which is 2.28 million more paid users over Q2FY2024, marking a steady growth over the past few quarters. According to the numbers provided by the OTT platform for the second quarter of the FY2024, India saw the second highest number of subscriber additions to the global streaming platform. 

Media reports indicate that Netflix had 12 million paying customers in India as of July 2024. Netflix's investment in local content production across India, as well as other APAC countries like Japan and Korea, is a primary driver of this success. India, in particular, has been witnessing rising engagement, thanks to tailored content catering to diverse linguistic and cultural preferences.

Local content has been pivotal in Netflix’s strategy to capture Indian audiences. The platform’s licensed film Maharaja garnered 22.6 million views, showcasing the demand for homegrown stories that resonate with Indian viewers. 

This success is further amplified by a slate of Indian series and films that cater to regional languages and cultures, helping Netflix solidify its foothold in a competitive Indian market. India’s diverse audience requires a tailored approach, which Netflix has embraced, allowing the platform to grow both its viewership and paid memberships.

While Netflix's global streaming revenue saw consistent growth, the APAC region, including India, contributed $1.128 billion in Q3 2024. However, Netflix faces challenges in terms of average revenue per membership (ARM), which saw a slight dip in APAC, indicating that while membership is growing, monetisation per user remains a work in progress. ARM in APAC stood at $7.31, showing a 4% year-over-year decline, which Netflix attributed to foreign exchange fluctuations and pricing sensitivity in regions like India.

Looking ahead, Netflix’s advertising initiative, though still nascent, could offer new avenues for growth in India. With a 35% increase in ads membership globally, and plans to roll out more ad-supported tiers, India’s large and price-sensitive user base could help Netflix further diversify its revenue streams.

India remains a key market for Netflix’s APAC growth strategy. With an expanding local content library and increasing paid memberships, the streaming platform is well-positioned to tap into the country's diverse and growing digital audience.