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The pandemic has been great for Netflix

The streaming service added another 10 million customers in the second quarter of the year.

Chris Hemsworth in Netflix’s Extraction.
Jasin Boland/Netflix

Three months ago, Netflix announced that it had seen a huge surge in new subscribers because people were stuck at home around the world, waiting out the Covid-19 pandemic.

So consider this a repeat: Netflix says that it also did great during April, May, and June of this year — because people were stuck at home around the world, waiting out the Covid-19 pandemic.

More specifically: The company signed up another 10 million more subscribers and now has 193 million subscribers worldwide.

The downside, Netflix said, is also something the company said last quarter: It worries that just about everyone who wants to get Netflix this year has already signed up for it, so its growth won’t be as enormous in the second half of the year.

That would be a problem all of Netflix’s many competitors, from Apple to Disney to AT&T’s HBO Max, would love to have. But while analysts had guessed that the arrival of all those competitors would cut into Netflix’s growth, that hasn’t panned out. And the fact that Wall Street allows Netflix to take on billions in debt, which it uses to buy and make truckloads of TV shows and movies, means that Netflix has been able to keep showing off new products to its customers while some of its cautious competitors have had a hard time keeping up.

But not even Netflix can fend off a pandemic forever. The company says that it will have plenty of new stuff to show people this year, but that next year it will have a “more second-half-weighted content slate in terms of our big titles.” Translation: If you’re still sheltering at home in February, you’re going to have to work harder to find Netflix stuff you want to watch.

Then again, we’re in unchartered waters here.

Three months ago, Netflix said that it had signed up 16 million subscribers instead of the 7 million it had planned on getting — and that all 9 million of the extra subscribers showed up in March when countries around the world told their citizens to stay home.

At the time, Netflix CEO Reed Hastings said he thought the company might sign up another 7.5 million subscribers in April, May, or June — or it might not, because no one has ever tried financial forecasting during a pandemic before. He described Netflix’s projections as “a bunch of us feeling the wind.”

Here’s what we seem to know now: Netflix seems to have been purpose-built to thrive in a pandemic. As I wrote in April:

It’s an internet-only business that hasn’t had to interrupt its service in any way, and it’s a subscription-based business that doesn’t make any money from advertising so it doesn’t have to worry about the collapse of that industry.

Netflix is also, for now, in a good position to ride out the pandemic: While it has billions in debt, it is generating lots of cash each month from its subscribers.

One other thing we know: Reed Hastings is no longer the CEO of Netflix, he’s the co-CEO. Hastings announced that he has promoted Ted Sarandos, his longtime head of content, to share the top title with him. It’s a signal that Sarandos is likely to eventually succeed Hastings, though Hastings says he “committed to Netflix for the long term.”

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