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Netflix beat Wall Street expectations

Netflix beat Wall Street expectations on both earnings and revenue. The company added 35 million paid subscribers on a year-over-year basis, sending the streaming giant’s stock higher.

KEY FACTS

  • Netflix reported earnings of $5.40 per share and revenue of $9.82 billion in the third quarter of 2024 ended Sept. 30, beating analysts’ consensus estimates of $5.12 and $9.77 billion, respectively, according to FactSet.
  • The company saw a roughly 14% jump in global subscribers to 282 million from 247 million in the third quarter of last year – although subscriber growth slowed as the platform added just over 5 million paid members last quarter, compared to 8 million in the second quarter of 2024 and 8.76 million in the third quarter of 2023.
  • Revenues are up 15% year-on-year.
  • After months of strong subscriber growth (largely stemming from the introduction of a cheaper advertising tier in May and the implementation of password-sharing measures), the stock hit a record high of $736 last Friday, surpassing its previous high of $733. placed just the day before.

KEY STORY

Analysts had expected the price hike to support strong revenue growth as the explosion in subscriber growth from a crackdown on password sharing began to wane. Netflix’s last major price increase in the US was in October 2023, when it raised the “Basic” plan to $11.99 per month and the “Premium” plan to $22.99 per month. Netflix Originals continued to drive engagement in the third quarter with shows like Emily in Paris Season 4, The Perfect Couple, according to a UBS analyst report.

Cloudflare Redefines Data Access With Default AI Crawler Blocking

Cloudflare, the renowned content delivery network, is set to transform the landscape of digital content access by instituting default measures to block AI crawlers from scraping websites without explicit permission or compensation. This significant move is poised to reshape the way artificial intelligence models are trained and could drive new revenue streams for content creators.

Empowering Publishers And Reinforcing Internet Integrity

Beginning Tuesday, every new web domain signing up with Cloudflare will be prompted to define its stance on AI crawlers. This default setting grants publishers the authority to restrict unauthorized data scraping and even monetize access through a “pay per crawl” model. As businesses increasingly rely on digital platforms to deliver content seamlessly, Cloudflare’s initiative underscores the growing need to balance technological innovation with content ownership rights.

Understanding The Role Of AI Crawlers

AI crawlers are automated tools that aggregate vast amounts of online data—texts, articles, images—to refine and train large language models developed by industry leaders such as OpenAI and Google. Historically, these models have leveraged content without directing traffic to the original sources, a practice that may inadvertently diminish revenue streams for publishers traditionally buoyed by organic web visits and advertising.

A Strategic Shift With Long-Term Implications

Matthew Prince, co-founder and CEO of Cloudflare, stated that the initiative is about restoring power to content creators while maintaining an environment conducive to continued innovation in AI development. This move reflects a broader industry trend, where digital platforms are increasingly scrutinized for how they balance technological progress with fair compensation for creators.

Industry Reactions And Future Outlook

While Cloudflare’s announcement has been met with praise from some quarters, several experts caution that the long-term effects on AI training capabilities remain to be seen. Critics argue that restricting data streams might hinder the evolution of AI or delay the refinement of its underlying algorithms. Nevertheless, the strategic decision to integrate such safeguards directly into Cloudflare’s default settings marks a pivotal moment in the ongoing debate over data ownership and digital rights.

As the digital economy continues to evolve, industry stakeholders will be closely monitoring how these measures influence both the operational dynamics of AI technology and the broader ecosystem of content monetization.

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