After years of rapid subscriber gains, Netflix is working to grow by building advertising, live events and video games. The company's stock has lost about a fifth of its value this year as investors question how it will sustain growth.
Netflix is facing competition from all corners of the entertainment industry, from traditional media companies such as Walt Disney to YouTube, a growing presence in living rooms, and mobile viewing on apps such as TikTok.
In April, Netflix said it had more than 325 million paying members and still had room to increase that number.
The company is building an advertising business and offering video games, two initiatives still in the early stages. It repeated an earlier forecast that ad revenue would reach $3 billion by the end of the year. The company is counting on its growing number of live events, including an expanded NFL slate, to draw more advertising dollars.
On a post-earnings video, Peters said the company was considering whether to offer a free option with advertising in some markets but had no near-term plans to launch one.
Netflix said engagement, or the amount of time people spend watching the service, was "healthy." Viewing hours grew by 2% in the first half of the year, compared with 1.5% a year ago.
It said it aimed to stay ahead of the competition in part by using technology to improve all aspects of its business. Use of generative artificial intelligence by producers is "scaling quickly" and has been employed in about 300 titles, mostly in post-production, the company said.
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