A couple sits in front of a television with the Netflix logo on it.
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From Netflix The second-quarter earnings report didn't contain any bombshells, and that's a good thing for the company and its investors.
In recent weeks, Paramount Global agreed to merge with Skydance Media. Warner Bros. Discovery is considering all options for its future and could lose the NBA broadcast rights.
While the media and entertainment landscape around Netflix is in a state of flux, the world's largest streaming service is comfortable with the status quo.
“If we do this right — better stories, easier discovery and more fans — while also consolidating into newer areas like live entertainment, gaming and advertising, we believe we have much more room to grow,” Netflix said in its quarterly letter to shareholders. “Because when we delight people with our entertainment, Netflix can drive greater engagement, revenue and profits than our competitors. This, in turn, creates a more beloved and valued entertainment company — for our members, creators and shareholders — that we can strengthen and grow over time.”
Netflix classified the market for streaming, pay TV, movies, games and branded advertising as a $600 billion industry in terms of total annual sales, noting that the company accounts for about 6% of that revenue.
The streaming service added more than 8 million subscribers in the quarter. It now has more than 277 million global customers, making it by far the largest subscription streaming service in the world. Netflix's market valuation at the close of trading on Thursday is $277 billion.
Nielsen statistics show that Netflix is the second most-watched streaming service in the United States, behind only YouTube. But instead of worrying about… From YouTube In the face of competition, Netflix is content to focus on the other 80% of the television market, the company reiterated.
“Looking ahead, we believe our biggest opportunity is to gain a greater share of the 80%-plus of TV time (primarily linear and streaming) that neither Netflix nor YouTube have today,” the company said.
While Warner and Disney announced a new company-wide package in May that will give consumers the ability to purchase Max with Disney’s suite of streaming services at a discount, Netflix has made it clear it doesn’t feel the need to engage with the competition.
“We have not bundled Netflix with other streaming services like Disney+ or Max because Netflix already serves as a go-to destination for entertainment thanks to the breadth and variety of our offering and superior product experience,” Netflix said. “This has driven industry-leading penetration, engagement and retention for us, limiting the benefit to Netflix of directly bundling it with others.”
Netflix's focus remains on building its advertising business and adding streaming subscribers on the strength of its content.
It's not the most dramatic story of all and it may not be a good series for Netflix.
But as an investment, shareholders will gladly accept it.
WATCH: Netflix far exceeds Q2 subscribers
