NFLXNetflix, Inc.

Netflix is a video subscription service that has moved from growth at any cost to growing revenue per subscriber.

The business is structurally simple: subscribers pay monthly, the company spends on producing and licensing content. For a long time growth came from new countries and new subscribers; once the market matured, the priority became revenue per member — price rises, paid sharing outside the household, and a cheaper ad-supported tier.

The ad tier is a strategically important addition: it widens the audience downward on price while opening a second income stream independent of subscription fees. Separate initiatives include games and live sporting events, used to hold attention between premieres.

The dominant cost is content, produced worldwide so that local series serve both their home audience and the global one. The risks are market saturation, competition from studios with their own libraries, and churn sensitivity when prices rise. The company pays no dividend, directing cash into content and buybacks.