Netflix Reverses Decline, Adding 2.4 Million Subscribers

The company said Tuesday that it added more than 2 million subscribers in the third quarter, snapping a streak of customer losses this year.

The streaming giant said it has over 200 million subscribers worldwide, beating its previous forecast of about one million additions. The company lost 200,000 subscribers in the first quarter.

In its quarterly letter to shareholders, the company said it believes it is on a path to re-accelrate growth. Satisfying members is the key.

The company is trying to get more people to subscribe to its service by introducing advertising. The advertising-supported tier is priced at $6.99 a month in the United States.

The company generated $7.9 billion in revenue in the third quarter, a 6 percent increase from the same period a year ago. There was a decrease in the company's profit of 3 percent.

For years, the company had promoted its ad-free experience as a selling point for customers, and the introduction of an advertising option was an about face. Reed Hastings reversed course after announcing subscriber losses on the company's first quarter earnings call.

In the last few years, streaming has become more competitive. Disney reported in August that it had more than 200 million subscribers. In December, it will offer a lower priced advertising tier.

This fall, the company is breaking with convention. It is the first time that the company has struck a deal with the nation's largest theater chains at the same time. The movie was written by Rian Johnson and stars Daniel Craig as the Delphic detective.

According to the research firm MoffettNathanson, 16 percent ofNetflix users share passwords, more than any other U.S. service. According to its estimate, the company said in April that it was sharing passwords with 100 million households.

The company has made some changes to costs. In May, about 150 workers were laid off from the company, mostly in the United States. The company said the cuts were due to slower revenue growth.

The decline in its share price hasn't been reversed despite the changes. Over the last year, the company's stock has plummeted as investors and analysts wrestle with the economics of streaming video.

A mix of films and TV shows were released during the third quarter, including "The Gray Man," a big-budget action film starring Ryan Gosling and Chris Evans and directed by the brother and sister team of Anthony and Joe Russo. The second half of season four of "Stranger Things" was released at the end of last quarter.