iWorld
Netflix soars higher and higher in Q4 2024; FY 2024
MUMBAI: It’s netted a financial performance like never before. Global streamer Netflix concluded 2024 on a high note, achieving significant financial milestones and operational growth. With a focus on re-accelerating revenue, expanding membership, and delivering record-breaking content, the company also outlined its strategic priorities for 2025.
2024 Financial Performance
1. Revenue Growth:
o Total revenue for 2024 reached $39 billion, a 16 per cent increase year-over-year.
o Growth was supported by strong membership additions and successful content.
2. Operating Metrics:
o Operating income surged to $10.4 billion, marking the first time the company surpassed this threshold.
o Operating margins improved by six points, closing at 27 per cent.
3. Membership Expansion:
o Global paid memberships rose to 302 million, with a record annual net addition of 41 million subscribers.
4. Content Success:
o Netflix dominated engagement metrics, achieving more viewing hours than its competitors combined.
o Top content included Squid Game Season 2, Carry-On, and the Jake Paul vs. Mike Tyson fight—the most streamed sporting event ever.
Q4 2024 Highlights
1. Quarterly Revenue:
o Revenue for Q4 increased 16 per cent year-over-year to $10.2 billion, or 19 per cent on a currency-neutral basis.
2. Net Membership Additions:
o Added 19 million net paid subscribers, marking the highest quarterly growth in Netflix’s history.
3. Profitability:
o Operating income rose by 52 per cent year-over-year to $2.3 billion.
o Earnings per share (EPS) doubled, reaching $4.27 compared to $2.11 in Q4 2023.
4. Content Performance:
o Blockbusters like Squid Game Season 2 and holiday NFL games drove record viewership.
2025 Strategic Outlook
Netflix is poised for continued growth, focusing on content innovation, monetization, and global expansion.
1. Revenue and Profitability:
o Projected revenue: $43.5-$44.5 billion, reflecting 12 per cent-14 per cent growth.
o Operating margin forecast: 29 per cent, up from 27 per cent in 2024.
2. Content Plans:
o Return of fan-favorites like Stranger Things, Wednesday, and Ginny & Georgia.
o New live programming, including FIFA Women’s World Cup rights and NFL Christmas Day games.
o Expansion of gaming, with the successful Squid Game: Unleashed and cloud gaming trials.
3. Advertising Strategy:
o The ad-supported tier accounted for 55 per cent of sign-ups in ad-available countries in Q4.
o Planned rollout of first-party ad-tech in the U.S. by Q2 2025 to enhance targeting and engagement for advertisers.
4. Free Cash Flow and Debt Management:
o Expected free cash flow: ~$8 billion.
o Reduction of $1.8 billion in bonds due in 2025 using proceeds from 2024 debt offerings.
Netflix Co-CEO Ted Sarandos revealed that the company is eyeing streaming of sports in the near future. (Do we expect some amount of cricket rights competition heating up going forward? Sarandos said; “Right now, we believe that the live events business is where we really want to be, and sports is a very important part of that, but it is a part of that expansion.”
The company also unearthed new price points with the standard monthly subscription without advertisements will costing $17.99, up from $15.49; the Standard monthly package with ads will rising from $6.99 to $7.99; 4K video quality subscriptions will be priced at $24.99 as compared to $22.99 now. This new price will first roll out in north America and will be followed by Europe and Apac later.
The hope is that the price increase will push customers towards the ad supported tier which will mean higher ARPUs for Netflix.
iWorld
Bill Ackman makes a $64bn bid for Universal Music Group
The hedge fund boss wants to list the world’s biggest record label in New York and thinks he knows exactly what ails it
NEW YORK: Bill Ackman wants to buy the world’s biggest record label. Pershing Square Capital Management, the hedge fund run by the billionaire investor, submitted a non-binding proposal on Tuesday to acquire all outstanding shares of Universal Music Group in a business combination transaction worth roughly $64.4 billion (around 55.8 billion euros).
Under the terms of the offer, UMG shareholders would receive 9.4 billion euros in cash, equivalent to 5.05 euros per share, plus 0.77 shares of a newly created company, dubbed New UMG, for each share held. Pershing Square values the total package at 30.40 euros per share, a 78 per cent premium to UMG’s closing price on April 2.
The deal would see UMG merge with Pershing Square SPARC Holdings, with the combined entity incorporating as a Nevada corporation and listing on the New York Stock Exchange. New UMG would publish financial statements under US GAAP and become eligible for S&P 500 index inclusion. Pershing Square says the transaction is expected to close by year-end, with all equity financing backstopped by Ackman’s firm and its affiliates, and all debt financing committed at signing. The transaction would cancel 17 per cent of UMG’s outstanding shares, leaving New UMG with 1.541 billion shares outstanding.
Ackman has a long history with UMG. Pershing Square first bought approximately 10 per cent of the company from Vivendi in the summer of 2021 for around $4 billion, around the time of UMG’s listing on the Euronext Amsterdam exchange. He has since trimmed that position, raising around $1.4 billion from the sale of a 2.7 per cent stake in March 2025, and resigned from UMG’s board in May 2025, citing new executive and board obligations arising from recent investments.
His diagnosis of UMG’s troubles is blunt. The company’s stock has fallen around 33 per cent over the past twelve months on the Euronext Amsterdam exchange, and Ackman lays out six reasons why. These include uncertainty around the Bolloré Group’s 18 per cent stake in the company, the postponement of UMG’s US listing, the underutilisation of UMG’s balance sheet, the absence of a publicly disclosed capital allocation plan and earnings algorithm, a failure to reflect UMG’s 2.7 billion euro stake in Spotify in its valuation, and what Ackman calls suboptimal shareholder investor relations, communications and engagement.
The Bolloré stake has long cast a shadow over the company. Cyrille Bolloré stepped down from UMG’s board in July 2025 as the Bolloré Group battled the French financial markets regulator over its stake in Vivendi, which holds a further capital interest in UMG. UMG had confidentially filed a draft registration statement with the US Securities and Exchange Commission in July 2025 for a proposed secondary listing in America, but put those plans on hold in March 2026, citing market conditions.
Ackman has kind words for UMG’s management, at least. “Since UMG’s listing, Lucian Grainge and the company’s management have done an excellent job nurturing and continuing to build a world-class artist roster and generating strong business performance,” he said. But he made his diagnosis plain: “UMG’s stock price has languished due to a combination of issues that are unrelated to the performance of its music business and importantly, all of them can be addressed with this transaction.”
In other words, Ackman believes UMG is a great business trapped inside a broken structure. If the board agrees, he intends to fix that, loudly and in New York.
