Netflix's latest earnings update said nothing about games or podcasts, which it had praised to investors for years. That hints at where it will focus.
Netflix has gone quiet on video games and podcasts. When it released its third-quarter earnings on Tuesday, the company had nothing to say about either one. That is a sharp change from recent updates, where both were presented as promising new areas for growth.
Earnings reports are the quarterly updates companies give to investors. Netflix used to use them to promote its games business, which it launched in 2021. This time, the only mention of games or podcasts was a single legal line about forward-looking statements.
Netflix did not explain the silence. Business Insider's reporter drew his own conclusion: Netflix does not expect games or podcasts to do much for its business in the near future. The Wall Street Journal reported that Netflix has recently stopped pushing games and podcasts and is focusing more on its core movie and TV offerings.
Netflix noted that half of its viewing happens in the evening. Podcasts were pitched as a way to fill other parts of the day.
The most pressing problem for Netflix, according to the report, is making movies and shows that attract new subscribers and keep current ones watching longer. Games and podcasts made sense in theory. Netflix has often said gaming competes for its viewers' time, and video podcasts are close to low-budget talk shows.
But it has been hard to see how Netflix could make games better or more popular than the rest of the game industry. It is also unclear whether people who open Netflix for distraction want low-key conversations.
One gaming item did appear in the update. Netflix said a 27-minute trailer for Take-Two's "Grand Theft Auto VI" was a hit. It showed the trailer exclusively for a six-hour window. That is someone else's game, not one Netflix made.
If you pay for Netflix, expect the focus to stay on shows and movies. Any games or podcasts already on the service may still be there. But Netflix is no longer promising investors that they will grow, so treat them as extras that could change.
Netflix has not said it is ending either effort. The Business Insider writer allows that both could become meaningful one day, but says the company seems to be signaling that will not happen soon. The next earnings update will show whether games and podcasts come back into the conversation.
Netflix is putting shows and movies first, so treat its games and podcasts as nice extras that may not get much attention.
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