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      Netflix Earnings Results: Q3 2021

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      It’s been a tale of two Netflixes over the last few weeks, as a long-anticipated Dave Chappelle special drew sharp condemnations from staffers and critics alike and as the South Korean sleeper hit “Squid Game” became a global sensation, making it the streamer’s most-watched series to date. (Both detail a grim view of the world.)Neither contributed much to the company’s results in the third quarter, which ran through Sept. 30 (“Squid Game” debuted in the last week of September and Mr. Chappelle’s special became available in October), but Netflix gained 4.4 million new subscribers in the period, beating its own estimate of 3.5 million. Netflix now has 222 million customers, about 67 million of them in the United States. The company booked $7.5 billion in revenue and $1.4 billion in profit, slightly better than expectations.Both shows do matter to the company’s current quarter, for which Netflix anticipates adding 8.5 million new customers, one of the biggest quarterly forecasts in the company’s history. Netflix also said it expected to generate $365 million in profit on $7.7 billion in sales. In other words, as far as Wall Street is concerned, what controversy?Mr. Chappelle’s show became a rare public relations nightmare for Netflix as critics saw it as a hostile invective toward the transgender community rather than the boundary-pushing stand-up routine that Ted Sarandos, the company’s co-chief executive, defended it as. Employees have threatened to walk out in protest on Wednesday, and some in the creative community have called out Mr. Sarandos.Jaclyn Moore, the head producer for the Netflix series “Dear White People,” said she would no longer work for the company if “they continue to put out and profit from blatantly and dangerously transphobic content.”Then there’s “Squid Game.” The dystopian series pits indebted citizens against each other in a set of children’s games where losers die and the winner walks away with millions in cash. The show has stormed the globe and has become one of Netflix’s most valuable new franchises, inspiring memes and costumes just in time for Halloween.“A mind-boggling” 142 million accounts watched at least the first two minutes of the show in its first month, making it the No. 1 program in 94 countries, including the United States, the company said. “The breadth of ‘Squid Game’s’ popularity is truly amazing.”A set of leaked internal documents revealed that “Squid Game,” which cost $21 million to make, is worth at least $891 million by one Netflix metric, according to a recent report in Bloomberg News. The story revealed for the first time how Netflix determines the value of its programming, a mystery that has long frustrated Hollywood’s producers.Unlike traditional television, where economics are governed by ratings and cable licensing fees, Netflix has a completely different set of financial goals. It has no live programming, no commercials, no prime time. Unlike network TV, Netflix doesn’t make more money when viewers watch more hours of programming. It makes more money when people sign up.The company can estimate whether subscribers joined to watch a specific show or even if a program kept customers from leaving. Based in part on that data, Netflix ascribes an “efficiency” metric to a show based on the value of each viewer, according to the documents leaked to Bloomberg. “Squid Game” has a very high “efficiency” rating, akin to a profit measure.Netflix’s share of the streaming pie has continued to shrink as competitors like Disney+, AppleTV+ and HBO Max have entered the market. The company’s “demand interest” — a measure of the popularity of shows and streaming services created by Parrot Analytics and a key barometer of how many new subscribers services are likely to attract — has started to fall. Netflix’s share of interest dropped 2.5 percentage points to 45.8 percent in the third quarter, while Disney+ and AppleTV+ gained in market share, the measurement firm said.Netflix said it would start disclosing different data points on viewership such as hours viewed and would no longer report the number of accounts watching a particular program.Netflix is looking for new ways to keep customers glued to its service and has started experimenting with games. The company recently acquired Night School Studio, the producer of the story-based game Oxenfree.“It remains very early days for this initiative and, like other content categories we’ve expanded into, we plan to try different types of games, learn from our members and improve our game library,” Netflix said on Tuesday. More

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      Gadsby and Netflix Employees Pressure Executive Over Dave Chappelle Special

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      Tensions at Netflix continued to flare on Friday, 10 days after the release of a special by the comedian Dave Chappelle that critics inside and outside the company have described as promoting bigotry against transgender people.Early on Friday, a Netflix star criticized the company and Ted Sarandos, a co-chief executive, in a stinging social media post. Later in the day, Netflix said it had fired an employee for sharing documents related to Mr. Chappelle with a reporter, and Mr. Sarandos fielded pointed questions from employees during a companywide virtual meeting.In a rare public rebuke, the Australian comedian Hannah Gadsby upbraided Mr. Sarandos by name for his defense of Mr. Chappelle. Ms. Gadsby, whose 2017 Netflix special, “Nanette,” earned an Emmy and a Peabody Award, is the most prominent entertainer to criticize Mr. Sarandos and Netflix, which she referred to in an Instagram post as an “amoral algorithm cult.”Mr. Sarandos and Netflix’s other co-chief, Reed Hastings, have been unwavering in their support of Mr. Chappelle, who signed a lucrative multiyear deal with the company in 2016 and has won Emmys and Grammys for his Netflix work. In a note this week, Mr. Sarandos countered the arguments of Netflix staff members who had suggested that Mr. Chappelle’s special, “The Closer,” could lead to violence against transgender people, writing that he had the “strong belief that content on-screen doesn’t directly translate to real-world harm.”Mr. Sarandos, who joined Netflix two decades ago and became its co-chief executive last year, also said that the company would go to great lengths to “ensure marginalized communities aren’t defined by a single story.” He cited inclusive Netflix programs like “Sex Education” and “Orange Is the New Black” as well as Ms. Gadsby’s specials, which also include “Douglas,” released in 2020.In her social media post on Friday, Ms. Gadsby, who is a lesbian, objected to the executive’s references to her in his defense of the company and Mr. Chappelle’s special.Hannah Gadsby, whose Netflix specials were critical and popular successes, called the company “amoral” in a social media post on Friday.Sara Krulwich/The New York Times“Hey Ted Sarandos!” Ms. Gadsby wrote. “Just a quick note to let you know that I would prefer if you didn’t drag my name into your mess. Now I have to deal with even more of the hate and anger that Dave Chappelle’s fans like to unleash on me every time Dave gets 20 million dollars to process his emotionally stunted partial world view.”She continued: “You didn’t pay me nearly enough to deal with the real world consequences of the hate speech dog whistling you refuse to acknowledge, Ted.”Netflix declined to comment on Ms. Gadsby’s remarks.At a virtual company meeting that started at 10 a.m. Pacific time on Friday, Mr. Sarandos replied to a series of tough questions from employees, who asked about Mr. Chappelle’s special and how the company had responded to criticisms of it, according to three people with knowledge of the gathering. The event became emotional when several employees were persistent in their questioning of Mr. Sarandos and his support for someone who they feel engages in hate speech, the people said.After the meeting, Netflix said in a statement that an employee had been fired for sharing internal documents pertaining to Mr. Chappelle with the press.“We have let go of an employee for sharing confidential, commercially sensitive information outside the company,” the statement said. “We understand this employee may have been motivated by disappointment and hurt with Netflix, but maintaining a culture of trust and transparency is core to our company.”The documents included private financial information regarding Mr. Chappelle’s Netflix specials that were published this week by Bloomberg, according to a person with knowledge of the termination. The documents included the costs for the specials — $24.1 million for “The Closer” and $23.6 million for Mr. Chappelle’s previous special, “Sticks & Stones” — as well as an internal metric that determines the value of the specials relative to their budgets.Such data is available to Netflix staff but rarely made public. The appearance of the statistics in a published article is a further sign of how deep the schism is between some Netflix employees and company leadership.Several organizations, including GLAAD, which monitors the news media and entertainment companies for bias against the L.G.B.T.Q. community, have criticized Mr. Chappelle’s special as transphobic. A group of Netflix workers has planned a walkout for next week in protest.Nicole Sperling More

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      Chappelle Special on Netflix Draws Criticism and Internal Unrest

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      The comedian Dave Chappelle’s comments on transgender people and gender in “The Closer” have led to outside criticism and internal unrest at the company that upended Hollywood.It was looking like a great year for Netflix. It surpassed 200 million subscribers, won 44 Emmys and gave the world “Squid Game,” a South Korean series that became a sensation.That’s all changed. Internally, the tech company that revolutionized Hollywood is now in an uproar as employees challenge the executives responsible for its success and accuse the streaming service of facilitating the spread of hate speech and perhaps inciting violence.At the center of the unrest is “The Closer,” the much-anticipated special from the Emmy-winning comedian Dave Chappelle, which debuted on Oct. 5 and was the fourth-most-watched program on Netflix in the United States on Thursday. In the show, Mr. Chappelle comments mockingly on transgender people and aligns himself with the author J.K. Rowling as “Team TERF,” an acronym for trans-exclusionary radical feminist, a term used for a group of people who argue that one’s gender identity is fixed at birth.“The Closer” has thrust Netflix into difficult cultural debates, generating the kind of critical news coverage that usually attends Facebook and Google.Several organizations, including GLAAD, the organization that monitors the news media and entertainment companies for bias against the L.G.B.T.Q. community, have criticized the special as transphobic. Some on Netflix’s staff have argued that it could incite harm against trans people. This week, the company briefly suspended three employees who attended a virtual meeting of executives without permission, and a contingent of workers has planned a walkout for next week.A discussion this week on an internal Netflix message board between Reed Hastings, a co-chief executive, and company employees suggested that the two sides remained far apart on the issue of Mr. Chappelle’s special. A transcript of the wide-ranging online chat, in which Mr. Hastings expressed his views on free speech and argued firmly against the comedian’s detractors, was obtained by The New York Times.One employee questioned whether Netflix was “making the wrong historical choice around hate speech.” In reply, Mr. Hastings wrote: “To your macro question on being on the right side of history, we will always continue to reflect on the tensions between freedom and safety. I do believe that our commitment to artistic expression and pleasing our members is the right long term choice for Netflix, and that we are on the right side, but only time will tell.”He also said Mr. Chappelle was very popular with Netflix subscribers, citing the “stickiness” of “The Closer” and noting how well it had scored on the entertainment ratings website Rotten Tomatoes. “The core strategy,” Mr. Hastings wrote, “is to please our members.”Replying to an employee who argued that Mr. Chappelle’s words were harmful, Mr. Hastings wrote: “In stand-up comedy, comedians say lots of outrageous things for effect. Some people like the art form, or at least particular comedians, and others do not.”When another employee expressed an opinion that Mr. Chappelle had a history of homophobia and bigotry, Mr. Hastings said he disagreed, and would welcome the comedian back to Netflix.“We disagree with your characterization and we’ll continue to work with Dave Chappelle in the future,” he said. “We see him as a unique voice, but can understand if you or others never want to watch his show.”He added, “We do not see Dave Chappelle as harmful, or in need of any offset, which we obviously and respectfully disagree on.”In a note to employees this week, Ted Sarandos, Netflix’s other co-chief executive, expressed his unwavering support for Mr. Chappelle and struck back at the argument that the comic’s statements could lead to violence.“While some employees disagree,” Mr. Sarandos said in the note, “we have a strong belief that content onscreen doesn’t directly translate to real-world harm.“The strongest evidence to support this is that violence on screens has grown hugely over the last 30 years, especially with first-party shooter games, and yet violent crime has fallen significantly in many countries,” he continued. “Adults can watch violence, assault and abuse — or enjoy shocking stand-up comedy — without it causing them to harm others.”“The Closer” was Mr. Chappelle’s sixth special for Netflix. Reed Hastings, one of the co-chief executives, said Netflix would “continue to work with Dave Chappelle in the future.”Robyn Beck/Agence France-PresseMr. Chappelle, who signed a multiyear deal with Netflix in 2016, warns his audience early in “The Closer” that he will be delving into hot-button topics. Before going into transgender issues, he offers a routine about threatening to murder a woman who criticized his work as misogynist and describes an encounter when he supposedly beat a lesbian at a nightclub.Terra Field, a software engineer at Netflix and one of the three employees who were suspended for joining a quarterly meeting of top executives that they were not invited to, said on Twitter last week that the special “attacks the trans community, and the very validity of transness.” (Ms. Field and the other suspended employees have been reinstated.)Jaclyn Moore, an executive producer for the Netflix series “Dear White People,” said last week that she would not work with Netflix “as long as they continue to put out and profit from blatantly and dangerously transphobic content.”On Wednesday, GLAAD criticized Mr. Sarandos’s claim that on-screen content does not lead to real-world violence. “Film and TV have also been filled with stereotypes and misinformation about us for decades, leading to real-world harm, especially for trans people and L.G.B.T.Q. people of color,” the organization said in a statement.Netflix declined to comment. A representative for Mr. Chappelle did not respond to a request for comment.During the homebound months of the pandemic, Netflix has been viewed as a happy escape, but this is not the first time the company has been mired in controversy. In 2019, it received tough criticism when it blocked access to an episode of Hasan Minhaj’s talk series in Saudi Arabia after the kingdom’s government asked it to do so. Last year, Netflix was accused of sexualizing the child actresses in “Cuties,” a French film. And the company was accused of glorifying sex trafficking after it started streaming “365 Days,” a film from Poland that proved so popular, Netflix ordered two sequels, despite the criticism.As Netflix becomes even bigger, it may find itself in the middle of cultural debates more frequently, said Stephen Galloway, the dean of Chapman University’s Dodge College of Film and Media Arts.“Netflix has gone from the underdog and outsider poking the establishment to the epicenter of the Hollywood establishment,” he said. “When you’re at the center, everything is magnified 100 times. This is going to happen more and more as society itself wrestles with these issues. With Netflix, what will make it further complicated is that it’s a global company with massive international ambitions.”Mr. Chappelle, 48, has had a long and celebrated career, winning an Emmy for his 2018 Netflix special, “Equanimity,” and Grammys for albums taken from the Netflix specials “The Age of Spin,” “Deep in the Heart of Texas” and “Sticks & Stones.” In 2019, he won the Mark Twain Prize for American Humor. Last year, he earned raves from critics for “8:46,” a heartfelt show on the death of George Floyd and the fraught state of race relations in America.He made his reputation largely through “Chappelle’s Show,” a Comedy Central sketch series, and created a legend for himself when he walked away from it after having misgivings about his own success. In particular, he told Time magazine in 2005, he was concerned when he heard a white man laughing at a sketch that satirized racial stereotypes and wondered if his material was being misinterpreted. “When he laughed, it made me uncomfortable,” he said.The critical reaction to “The Closer” has been mixed, with most reviewers acknowledging Mr. Chappelle’s comedic skills while questioning whether his desire to push back against his detractors has led him to adopt rhetorical tactics favored by internet trolls. Roxane Gay, in a Times opinion column, noted “five or six lucid moments of brilliance” in a special that includes “a joyless tirade of incoherent and seething rage, misogyny, homophobia and transphobia.”Last week, as the controversy over the special mounted, Mr. Chappelle made an appearance at the Hollywood Bowl in Los Angeles. In response to a standing ovation, he told the crowd, “If this is what being canceled is like, I love it.” More

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      Netflix Employee Who Criticized Dave Chapelle Is Among 3 Suspended

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      Netflix recently suspended three employees, including a transgender employee who posted a Twitter thread last week criticizing a new Dave Chappelle stand-up special on the streaming service as being transphobic.The employees were suspended after they attended a virtual business meeting among top executives at the company that they had not been invited to, a person familiar with the decision said on Monday, speaking on the condition of anonymity to discuss a personnel matter. Netflix said in a statement that the transgender employee, Terra Field, was not suspended because of the tweets critical of Mr. Chappelle’s show.“It is absolutely untrue to say that we have suspended any employees for tweeting about this show,” a Netflix spokesperson said in a statement. “Our employees are encouraged to disagree openly, and we support their right to do so.”Mr. Chappelle’s comedy special, “The Closer,” debuted on Netflix on Tuesday, and was quickly criticized by several organizations, including GLAAD, for “ridiculing trans people.” Jaclyn Moore, an executive producer for the Netflix series “Dear White People,” said last week that she would not work with Netflix “as long as they continue to put out and profit from blatantly and dangerously transphobic content.”Ms. Field, who is a software engineer at Netflix, tweeted last week that the special “attacks the trans community, and the very validity of transness.”On Monday, after news of her suspension went public following a report by The Verge, she tweeted: “I just want to say I appreciate everyone’s support. You’re all the best, especially when things are difficult.”As criticism of Mr. Chappelle’s special began last week, Netflix’s co-chief executive Ted Sarandos sent a memo to employees defending the comedian.“Several of you have also asked where we draw the line on hate,” Mr. Sarandos wrote in the memo. “We don’t allow titles on Netflix that are designed to incite hate or violence, and we don’t believe ‘The Closer’ crosses that line. I recognize, however, that distinguishing between commentary and harm is hard, especially with stand-up comedy which exists to push boundaries. Some people find the art of stand-up to be meanspirited, but our members enjoy it, and it’s an important part of our content offering.”Mr. Sarandos also cited Netflix’s “longstanding deal” with Mr. Chappelle and said the comedian’s 2019 special, “Sticks & Stones,” was also “controversial” and was “our most watched, stickiest and most award-winning stand-up special to date.”In 2019, Netflix was criticized when it blocked an episode of Hasan Minhaj’s topical show, “Patriot Act With Hasan Minhaj,” in Saudi Arabia after the kingdom’s government made a request for it to do so. In the episode, Mr. Minaj criticized the Saudi Arabian government and questioned the role of Crown Prince Mohammed bin Salman in the murder of the journalist Jamal Khashoggi.“We’re not in the news business,” Netflix’s co-chief executive Reed Hastings said in 2019, explaining the decision. “We’re not trying to do ‘truth to power.’ We’re trying to entertain.” More

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      Netflix Productions Are More Diverse Than Studio Films, Study Shows

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      AdvertisementContinue reading the main storySupported byContinue reading the main storyNetflix Productions Are More Diverse Than Studio Films, Study ShowsThe study, which the streaming giant commissioned, looked at films and TV series from 2018 and 2019.Ali Wong and Randall Park star in “Always Be My Maybe” on Netflix.Credit…NetflixFeb. 26, 2021, 9:30 a.m. ETFifty-two percent of Netflix films and series in 2018 and 2019 had girls or women in starring roles. And 35.7 percent of all Netflix leads during that span came from underrepresented groups, compared with 28 percent in the top 100 grossing theatrical films.Those findings were released on Friday by the University of Southern California’s Annenberg Inclusion Initiative, which Netflix commissioned to look at its own U.S.-based scripted original films and series. The study analyzed 126 movies and 180 series released during 2018 and 2019.“Notably, across 19 of 22 indicators we included in this study, Netflix demonstrated improvement across films and series from 2018 to 2019,” said Stacy L. Smith, who is the head of the initiative and has been studying representation in film and television since 2005, during an online symposium the company held to discuss the survey. She said Netflix had also increased the percentage of women onscreen and working as directors, screenwriters and producers; for Black cast and crew; and for women of color in leading roles.Of the 130 directors of Netflix films in those two years, 25 percent were women in 2018 and 20.7 percent in 2019 — outpacing the feature films released theatrically by other studios over the same period.While Netflix reflects gender equality in its leading roles in television series and films, when every speaking character is evaluated, those roles did not match what the country looks like from a gender and race perspective. Only 19.9 percent of all stories met that mark. For instance, 96 percent of stories did not have any women onscreen who identify as American Indian/Native Alaskan, and 68.3 percent of the content evaluated did not include a speaking role for a Latina. That number rose to 85 percent when it came to speaking roles for Middle Eastern/North African women.Scott Stuber, Netflix’s film chief, acknowledged how crucial those kinds of small parts were to working actors.“The SAG card is everything,” he said, referring to the Screen Actors Guild membership that performers earn by having roles in various projects. “That is the beginning of the dream. We have to be very active with our filmmakers and our casting directors to fix that. That’s the next great artist. That’s the next Viola Davis.”According to the report, L.G.B.T.Q. characters at every level of film and television were marginalized, particularly transgender characters. And just 11.8 percent of L.G.B.T.Q. characters in leading roles were shown as parents.“I was shocked that we are not doing great there,” said Bela Bajaria, the head of global TV for Netflix. “I feel like we are so active in our story lines. But the lack of gay parents in our shows, that’s a clear takeaway.”According to Netflix’s chief executive Ted Sarandos, the company is committed to releasing a new report every two years through 2026.“Our hope is to create a benchmark for ourselves, and more broadly across the industry,” he wrote in a blog post that accompanied the report.The director and screenwriter Alan Yang said during the symposium that he was bullish on the future of inclusion in entertainment, especially at Netflix, which produced a series he created with Aziz Ansari, “Master of None,” and his feature film “Tigertail.”“It’s going to improve a lot if Bela and Scott buy all the shows and films I pitch them,” Mr. Yang said with a laugh.AdvertisementContinue reading the main story More