Netflix (NFLX) 19 Oct 222022 Q3 Earnings call transcript

Good afternoon and welcome to the Netflix Q3 2022 Earnings Interview. I'm Spencer Wang VP of Finance IR and Corporate Development.

Joining me today are Co-CEO, Reed Hastings; Co-CEO and Chief Content Officer, Ted Sarandos; COO and Chief Product Officer, Greg Peters; and CFO, Spence Neumann.

Our interviewer this quarter is Doug Anmuth from JPMorgan.

As a reminder, we will be making forward-looking statements and actual results may vary. into jump let's that, it. With you Doug, first your over to question. for Session Question-and-Answer

Spencer. Great. for see all having great of to join Thanks, again And you you today. me and thanks

of in Obviously, with So heading let's launch. a jump lot the into discussion advertising. here

new the and basic XX week arrived and with ads markets. at how the you Can for you the for launching details tier ads? the point in product announced features with basic You understand price US other last help us

Doug. Yes,

And quite the incremental profit think term this consumer-facing positive a will lot thinking we'd we're in be basic lead different slate price price revenue roughly call in monetization, We're what of variety value neutral. is when terms that we’re do unit will we're well. us of then charging incredible more how countries of a think examples we think to to delivering for for lot them, -- revenue significant launching a confident And you delivering will some great that sort in what essentially trying QX we're stream. the the films in setting that a long And there, then, we the pricing specifically very the give hard lower bring regard can we their revenue and price QX combination looks of on see expected of plus and translate with ads, we consumers. to that in to at anticipated and So that work that this in fact we're on we're that series what's and ads, we're sure subscription the ads with to modeled make they that look as general out that of to dollars about a then, the pricing basic economics-wise anchors there with the that incredible in delivering we members shows. it

clarify getting more you are to basic how unit just guess, to of -- there I essentially and to about perhaps And, that's that comparing the basis more kind a talk tier? when on you Okay. economic accretive over what time, neutral

be may we member switching lot It relevant to Yes. see a that don't note plans. of

So oftentimes when say, in let's select resolution. a that's We feature, they they see choice. the XK come be to plan the and that pretty given sticky a for

in economics to neutral so, without basic when really ads. about unit the we're positive, And we're to feature like being thinking set comparing the

Okay.

great. Okay,

talk in advertisers of talked Jeremy, what little could a know, And demand you on add thus advertiser I almost and last board about sold you bit gives arm? out. far? inventory confidence about having how week maybe you So that would advertising frame hundreds

Microsoft in partner with their seeing through strong. that. working crack say initial that, well team agencies our but would action our we're both as that and the actual small see very and to sales is And obviously, of brands a and ad now in those were with where activities see advertisers models what's working models We bunch got the those Yes. sort actually to informed world. But countries bring in and different started the we we're by, in them to team great been in it's with sales of to And that I practice. as take demand get around we ad point the

about So against incredible the the a to their their around brands people proposition consumers positioning and have. the watching bunch our shows. ads of They're and very bringing titles excited the excited that of are the content are that world about we

And so, demand very, been strong. has that very

our models in process. that built lot into of a that actual expectations we of sort seeing we're so through sales come And the

great. that's So

we that before, -- walk that it's much noting of worth a think we're very the model of in iteratively we're about also crawl-walk-run talked sort improving. though I kind

so, we're a important of, make that are advertisers next the we And that boxes that of to quarters over bunch in of have. lot think sort capabilities attractive to check and, couple they of advertising a building offering increasingly

have That's a announced. the for seen map pretty we've that. road verification about on to excited do lot of partners that more good a might we're go You that that we But example brands. got delivering

Okay.

very terms capabilities of in well. those as So obviously, targeting, important here

targeting believe I you've well. about evolve age limited. will gender sign-up over from asked launch for on fairly genre and within options targeting shows time and I view and broad marketers talked that? top your as of Early think are the by feedback and country And at I has time? the What's at that think, how you targeting been XX the agencies having and also that

we're I But capabilities that this capabilities actually with now we to think, could consistent the went job Again, move to -- start XXX% of fully world to And additional is testament a what part Yes. hard to of have announced from with what lot sort relatively want into targeting do targetable in out and Microsoft. is it contextual to what can of starting And see we about digital it terms teams television we months we internal we we basically on in targeting our time. quickly. to see which as expect and more of so right? But do market six from get audience we where obviously genre we that's, have delivering signed-in point work over basic et targeting cetera. layer addressable, has to well, you a been from fully of, a in

more of data that. for we just that about think we're and that the that shape very how any off and worth ads we basically using building we're and paramount that that about use Netflix privacy this we or like anything will we want when used a way on relevant or offering also cognizant all be and deliver not to think in Netflix form noting profile make of to talk I offering it's data

lot players. And accurate? about a Xx Netflix? in or what Xx the much press justifies are really the been to for that There's other of those Is that discussion higher CTV pricing of CPMs Okay. AVOD

we're delivering I'm access that I that of not would the that think to that content And pricing, specific oftentimes offering it's harder very a a traditional of many we in combination to access audience attractive on in cases. result the hard to any comment have other that got. that's incredible certainly we've we've got but I going just ways, to TV it's a and in say

to that So Ted's team is want doing be advertisers to. job at producing titles next an amazing

the I that pricing what that's so demand is we get. the can think And you and driving see

Okay.

five in offering time. of somewhat hour be about about If ad the You've four past lower. innovative the wanting of think certainly talked it's and per minutes to we to range ads different minutes the over

You've the least tight capping. time? initial evolve that else you talked about And frequency in then does how more is innovative What do offering? at think over

Yes.

you want an As experience with we to noted pro-consumer-centric. start that's very

so for are ad our a between, about What and is that's capping. degree those is we And and frequency great their consumers. both alignment sort desires I of of, actually talk and things high about load informed definitely what advertisers the love the to we there's thinking think brands more

their sort sort So they're offering also caps ads having more and And a enthusiastic -- high loads about more apart of limited there. of unique having sets distinctly. frequency not ad

going access you've to with. bunch capabilities the us years think begin So then to And to time that the love over alignment a I leverage in of last seen think space. about I over innovation XX we're that the

we we about about present terms the think to can in and think think terms titles how great leverage also where of we example that I titles ads built of is a being need as don't personalization the how So members. and all capability uniform we've of And personalization across present ads. we our experience in we

but I to best starting And our going what dimension that's a what really experience, the is the native exciting important and that So to to out format looks don't I we're well. connected suited connected of what the capabilities think that work like. and we're about partners where as for also on they've premium to that understanding TV. meeting access got additionally format couple And advertisers it's the ad That's is TV there. at think market right forward work figuring looking need premium think today. with with for And over excited all is ad years we that we're an to to we're stay

innovation of I Doug business the And might market. just also part was just of the just us speed to add for innovation

innovation our so within is months going that and getting six to doing we to which just every over hopefully and bring XX revenue will As speed, of today nimbleness markets operate, Greg so region which our forward. in half part of so represent in launch to well from it that said announced path

Okay.

net tier? It's, you adds ads of concept a terms about existing just do with this new versus In from trade-down on subs think with subscribers, how discussion the of frequent investors. basic pretty obviously,

Yeah. to lot of Again, that I plan don't we see it's the important a reiterate switching plan think existing on set. just

find for factor price with land thinking to expected a I stated that really we our right that as and on to our trying and point modeled trying then, them. not ad stated and into point note. And pro-consumer to to obviously, let that's we're another. And basic approach them we think the monetization worthwhile on out ads. or a for one We're members performance plan around So we the as take steer before plan

But a we And as will this in factor consumers is again be consumer fine low. bring plans. significant to to and a anticipate so that those model members, leads be the a really extra in pricing more that pro-consumer switch this of will revenue some profit more because to and the expect stream. the is restate And attractive you incremental just we if going result be economics even members and when price revenue those again then this

different perhaps about do across reducing of how how out markets churn impact levels of that And some in and you the plays different and penetration? terms of characteristics think given the

Yeah.

that, what churn. generally I think is price obviously, helps lower with seen we've

be positive days now thing again months over launch and in think the to this come. so we've there'll I And we're much that we'll there. more But some learn and dynamics early got so really, to

so best churn to keep is Again reduce I the way engagement. of entertained. mean, them is to much that to tied

components Ted. the deal Sundar At of how to in revenue in confidence talk advertising last subscription ad minute any ever. Code deals Right, it done in and that biggest the Conference about which there you give deal time? and ad month the is you've outlook this here one that the of the over said past Are that clearly Netflix-Microsoft we'll particular compares a quarter more

Partly very was us really support had highly all strategically similar picking that flexibility were the how felt and going we the ours, then now about. leverage learn both I around the in a have to do that and lot stretched big And which is They that a when Well, just and now, one lot talked launch that right that lot it in right about two in in and Microsoft was of of a factors we're aligned. Microsoft frankly that. to terms we like little, has was demand approach we combined of of overtime. quickly for go-to-market and we that but capability to of between build is the we're see an we're thinking that teams flexibility we formats iterate approaches want to that we quickly there innovation the

joint they're Microsoft just better excited and do and going So, right think more some say everyone. capacity and about even now then away our can't we side to capacity that actually I'm on the that serve advertisers we some to to that to don't to hiring I able through and building it growth returning building actually grow have go-to-market be the capacity some we're hiring going ability because do folks which serve

Bob Iger off TV And said going was cliff. conference linear Doug at that that a same

did. He

They're XX is And on under just or just the faster demographic in we than fewer the to even people able pay-TV. impact then what I underappreciated reach being the was XX what and advertisers. decline to

cycle is properties like few TV the advertising So of really a as what collapsed linear is outside vehicle this that is fueling sports. really an

going So linear right dollars now? out -- and maybe just are you're you the dollars as do digital agencies going Reed going for well, feel brings Greg. and like you after that marketers after I or when you're TV up to you question mean

for brand I sometime competitive. our think as you I'd a the into probably we're think capabilities direct the versus as offering offering think where going think highly more attractive job with those leading at we're of incredible Obviously, But be competitive side, is right things response really going of we also our of more the think that brand that I components our we now. build the have that a lot realistically. more And of sort be in those are can of to overtime because worlds to -- of say advertisers that incredible components content that Obviously, what capture look be about audience that I when side makes I be we'll the competitive linear competitive we digital overtime and to we you then of add and be terms current to with. and we connect part sort can publisher have technical But etcetera. will an ads targeting into mostly in when go. want demand very blur

you like it costs or be the that is just for ad about talk running responsible given investments business very Maybe some in Okay. for terms of that feels of margin. of should And Spence high the it revenue bulk key the can sales ad Microsoft in now?

agree out I'd over you time. we need this build Doug. Yes, to with Again,

said profit out be a will and the to build in streams. on of this then kind big economic and neutral we you on think can of incrementality revenue positive feel add a gate incremental when Greg basis, the As we good subscribers that we unit net

build and small So, guidance. are the obviously And but gate. over Microsoft. I'm kind our of some pretty can reflected some QX obviously not margin cost specifics, believe into kind overall, accretive There's and other our get internal in some there. building the out we margin cost with It's accretive to be Peter. overtime. some It's of capabilities there's out our partnership But certainly costs going our to this of -- Jeremy there of be going with here then team of side to costs, to out

financial you of an don't launch. in it but impact see first business. overtime can build it's material As this to additive -- We're be kind not quarter, and intra-quarter we'll will expecting any partial the

right. All Great. Okay.

the record subscriber we're minutes for in about hitting So, here. XX not numbers until

subs So the million you but quarter. -- X.X third in added

you're before You're how around you of of walk sharing. us expecting in through million feeling kind can growth the core in kind XXXX advertising Maybe just X.X get you about paid dynamics XQ. into subscriber and

we're shrinking quarters. done with God, Well, thank

QX – of the on the is content the then prices in focused the supported, So Obviously, And to fantastic ad got that's pick sharing, a lines good side, are on, We we're to but on whether back the still quarter not momentum. a reasonable FX. the up feeling to that's we for year. reasonable. positivity. big up we're this Everything approach guidance next paid lowering us got there for the bubble the marketing, doing company

we've explained. So hit as that's a huge

So the us. that's well lining not all add go away. to going for other that? than up very to But Spence, you that want to stars do are

is we'd I growing which – yes, we're said, we're fast not still like. job as we Yes, – me, as appreciate great. for Reed, no, we're as my But doing you're that.

net when overall, similar things, QX. every the So our QX. which great pleased of slightly is region. our know lot adds we've at we're delivered with little got progress we in elevated more We where above we is we a to kind bit past building acquisition do. more a million, you But were quarters, remained, growth We're work pleased but we end than two We're saw to those of guide. a had of across yes, with bit Churn the few X.X which combine momentum. paid

content talked Ted with about. We're mentioned Dahmer and talked we And talk – nice QX, building. adds. X.X net are kind we as story we will paid and We sure as talked guiding that Jeffrey off about we to we're what that million Watcher a and of into is the the I'm start. of Monster, started others to forecast under Reflected for about guide obviously. strength the slate. then So in The you there

it's some seasonal got we start some – talked accelerators be it's bunch to just XXXX. near-term, and near-term macro that we sales strong So launch we also XXXX that. There's rolling we ads, out And of currency unpaid world. whether inflation, competition. the – in a monetizing least about those not still the the about. on we going don't all some We've around impact focused talking viewing, out the There's But that we're early it's be quarter. doesn't out, a revenue cycle expect big – letter, And that talked on first a we'll We been – and we for penetrating even financial geopolitical quarter. and the energy paid there's have about But in at to solution some higher other that as a TV connected in rolling limiters in the there. our prices of we market sharing have this take growth. whether strain the strain, again got until we've know

So little all But factored the than things guide. feel really It's visibility are we path those good to see. a that set We've we a would momentum. overall, typically less our into we're growth. that bit building

actuals in revenue paid for a to You're QX both seeing path XXXX. guide into importantly, the in and QX growth most accelerate growth hit and the to and ground running adds net in

Okay. Great.

fourth the to were in the more how Stranger your a in factor you becoming had with more You quarter? XQ and cadence driving series And language your Things ever months the is of much Do subs biggest span X English titles two believe I momentum to three those Dahmer. normalized of four think and into content post-pandemic? now

for we've get engage goal lot to people growth. us talk And Look, is our it's of drives got to value come do them I it. think big – a shows come and expect to that to about that. with folks

an after behind right they that that So something great something finish love they that right expectation there's it. there's

pretty described you it So nicely.

of X. Things Season out come Stranger You

roll you right a do right out with mean into going back-to-back a a then Man or And The movie animated that with Ryan then Purple Monster, that into Seabees, feature that, Watcher. right or the great Dahmer roll kits You big of fall from you like right story. like and into Jeffrey movie and Hearts move Gray you right like I

and Remember at as more at getting So, I do creation cadence XX been I we've only Doug, of think think content. our it it's that for original something -- get mature is we in better we're more years.

Yes.

is thing ahead other Reed, The -- go sorry.

about Ted just little kind can of at year we're monthly this get you to sort think talk a maybe of what that the next of smoothing easing out of we concentration. content COVID year, state what

they COVID content and rolls year the out, -- impact Yes. parts are then because and were all rolls of that when in later back working normal getting COVID. up jammed work, got during projects those and a to out lot on of the even people

COVID unnatural be TV than legacy and mostly cycles -- of will little QX completely historically, watching. series award historical the takes and with heavier kind cycles, several are of to a to fall that viewers those because QX And of and it take and things years tends it QX, fall the So, unwind to festivals logjam. all film the film the

to smoothing trying are aggressive make and watch we're about be that sure that So, the out ready when content to people available is to it. more more

Okay.

it really to content that, kind of of all across it's out And categories. add smoothing just to our

Ambers more big every Water well last I region in -- High of in mood Narco-Saints Sintonia just -- that Korea, big whatever that titles also even if language those to I'm or to And taste. it's watch ability last think And he English of this missed Brazil, what with some Germany, not great point, the said. and sorry your just it's the of local So impact in in Ted's the build local the travel. But titles. there's of can more have on if you quarter, in Poland, kind to even as always whether something

getting cadence of really region and kind world. that it's every the in around So, country

than of around was And watching of Woo around from probably, XXX world. Attorney go Korea, better example the million hours this Extraordinary none a

take that folks Korean would phenomenon real we as and other that a Just work the around extraordinarily world. being can view make show a it

greenlighting lot around content? all process a I around terms in discussion Okay. question content. just the it Ted, philosophy or is to? guess of the there's need a at selectivity of is, Does of there changing And the

me I we library. started as let to We -- saying what moved to We the back was quickly this no years build as ago. Look IP. earlier. no library about a that XXX. had had could go XX our been We to more our library. years, in now XX of more and over at competitors gets And viewing IP of library than own for revenue our and more who've it own profit We build all those

way along probably look of and we I a mistakes. lot. when learned a So okay, at the that lot think, And we made

audience go isn't of It's which culture just you've television lot proprietary the today, that's give making I that genre, a also and to creators them are as business, when that about our today, some to sets and the kind of of can we've fairly what across is prestige doing do things format think do, in that processes please delivery and it got our learned and very to deliver And we And a So the working with. across others thing stronger with can't bring to for remember the kind imaginable. that audience, connectivity making to skill in and I we from we benefit ensure they that do to we creativity what English. things every that pop just of quality developed partnerships want every scale some scale really compete and so that, can audiences. think and tools shows

all any creating of definitely me, when on we experience our that sharpening go we'd any better, about And original getting Netflix. the more time, have are you thing then, biggest staff, tools, you if the the So beginning getting we to had say we for process. didn't mature that's we're way anything the are back

seven to our today, which So, we're in the quarter. last we've in of this just releases of that all we is released quarter at popular up last time most build where

Great. Okay.

Spence talked $XX You last quarter kind around spending. staying cash about flattish or in number so billion of annual content

I that, year. differently? up push within spending when the But that from that's want of kind deliver you COVID does out that of to regions? the across the all you I realize quantity number costs discipline anything you guess, And also what's So, do content incremental both your take the and year, last that this around confidence you quality content can

I the Look, think cadence of range the what scope and scale, is we're as seeing Doug and hits both is improving. that, as the well

– I we're So more how and getting better content better about focusing on is billion than better do have we spend, $XX because that that better $X and else. at impact feel be anybody that's it. billion spend of And to per what

disciplined – So, bunch And the that. a we're revisit of but about pretty right that course, at we're spending think I we're reaccelerate number about right revenue, about level. the as we we'll

sequel Knives highly so Glass pretty Okay. Out The Onion anticipated.

But limited You're have release Thanksgiving, time going number run think for believe December Netflix, for also a before I push theaters, of seems I longer XX. in period in it to a on around to a week to been theaters. hitting of there perhaps it a

Netflix? one of that do what you to maybe is kind just viewership that some the on how debate think for do it can you the of about And release will So, just talk rationale drive week? there,

you, our on tell entertaining of Netflix in members we're business Netflix. with the movies I'll first, Well,

our focus we and of our of where most spends. energy all that's So

planet. are access world, is is a get to the week where always heavily in building made films in because those those for film, city doing demand, XXX festivals folks same the way the by we're they're the the release in Our screens of And on featured buzz a greatest creating filmmakers can't who on festival and one thing film a around all this to festivals.

our look for debates would another for and of no kinds people and all the There's I just really of the and of want movies watch for just the there ahead most see them is at as, will movies build week see all all Netflix but release. its like internally way And one by Netflix, most theaters, film, back watch release Most question to at of So our reputation make anticipation we forth, this we that home. build film time and with movies. members, course, buzz Netflix. in they people them to on

think that, I of that film we have we a run there's for that around, run time release this of the a them to travel think it's way somewhere particular we but the awards, in week sits festival, time plenty event. that and a – to we that and and So movies them louder between into condensing qualify a

Got it.

Okay. Pretty clear.

Let's talk a bit about paid little sharing. shift gears

become potential accounts settings You existing timing how just And to members announced borrowers we a profile and other transfer to own their either is or and yesterday, of Maybe their think an talk rollout to new having which member. about recommendations a non-paying kind facilitates precursor having shifting history there? the account. you can adding should of about this how

use when sure customer with as think getting of making value enable off a their history how account, frankly, towards that a get of mean, we and our to that it a this find we're and and is become but business paid you choice, And kid balancing it we customer key own long those informed that centricity transfer, think delivering we're entertainment you sort been supports service, and essentially paid profile learned approach and one I think working around supports ones. consumers. about supports try try going to help and can, try members home, what's us The is But obviously pretty our sharing. approaches with a where thing situations deal to working to where how understand balanced really a I hard product we use have we does changes that we position of we've to imagine who working. to about we reactions and adult, And and go as mean, different and Sure. there's cases, all try our of their a much like can what's couple listen at and different establishing an right? we that not

countries. approaches tried we've couple in of So, different a different

recommendations create part You think on for on separate that that attractive history that paid and ads Netflix else's own makes to basic that that sort And of sort for transforming lower-priced we somebody right that profile and are path especially be lower customer that And plan account that strikes separate the hopefully is saw we launching landed ability their will feedback that. And think borrowers, be based account the of that balance. that obviously, sharing able basically that an in the approach where key their more we're information to people with of using of access informs to component that account. now a is towards getting, And all attractive. great price, viewing great countries we're them. we their

allowing Netflix the this share pay for to though Another of component to is for or some able owners service account want they friends family to something be with.

And to that able to so account enable too. extra they're create we're member which calling sub model a

invest model but always has of that that on customer up sustainable to great entertainment members. trying come a with we're choice our for business balances Ted's of that team also that of allows ensures all us supports we've that to more considerations in a focused options range So, those got

that getting to early forward looking we're in XXXX. So, out

kind be bigger do Netflix? and And than of that XXXX for could accounts advertising you in extra member think new

bigger better. I to -- is which or want don't to say I be

share a need that price great many that business different a Paying that legitimate needs, for ads somebody that that content the you we're in that's to seeing right? And to get complementary Creating there's service all out with, us that's we're think for making. from a ways. a monetization what of need. for Netflix legitimate number balances as I they're a to is lower want with

this really I range So, as just think options needs, so And that range the speak to of way. range serve the that of on the right can to of we a right try in a a at different consumers planet price just right set. do points, trying the job expanding better feature that to more we're

starting subscribers decision talk provide Okay. you longer quarter. just Spence to bit next no the maybe little could on a guidance about

you Sure. one, do that take to Spencer want or...

it. question the Happy Sure. to I Doug. take appreciate

early particularly be quite start range days price to compare And different trying impact that can partnerships on over to focusing subscriber our business you're just that's true with such world, given have all the But if services. now economic points, subscribers wide maybe of streaming a helpful. we different. any was our in So, of other

develop metric I years. important new So, you've we that's why XXXX as more growth heard and primary to sharing is is only revenue we've going the several revenue membership been streams as And and topline focused picture. like increasingly where as revenue last talk on think aspect be this us paid of advertising we head into about even our the one

the you our we we the that every a global revenue continue also We'll the So, and just pinpoint disclose And And in revenue to well all count. net figure of other membership net to adds. income, our drivers provide on pay net give be se. for provide paid terms as some the operating forecast, Doug regional we to we earnings per continue then we'll when underlying as expect to guidance, lastly share today report income, won't quarter but that ads clear, of metrics membership namely EPS, you revenue, we'll continue do will we guidance margin, release do color operating just as our should today.

grand change. minor pretty of things, the in scheme So,

That's we by Okay. pressures. look That's If at It's FX heavily operating the great. XQ X% impacted guide, helpful. margin.

kind and bit little XX% there up XQ business in is of a Is perhaps of guess or Maybe more kind some of it anything kind on of you the I there. margins, factors X%. can basis FX of weighing that's fundamental there from think all talk year-over-year it's terms I a about FX? just ex on the

Doug FX neutral be actually you all really year-over-year prior XQ. we're we'd -- It's a as said. up X% at a margin mean, I versus XX% currency constant

to quarters look drag is a X year neutral. now FX So margin letter still range We roll our the what this number, four kind the full beginning XX% we're you to it's that January of -- we to significant. the FX holding out calling our we're neutral of in the year year to XX% of the do to you mentioned it can and math FX at if on --

that end -- see of little reported you'll it's is mid a higher in actually -- to on can over just range. You XX%. a it's the it But basis,

FX drag margin quarter X.X of about And fourth through as revenue million up points of billion year. about of of drag being the margin. it's to in drag. our it's is equates there's in So $XXX built that $X about That the the bulk felt

guess content can cash just spending. I maybe talk Okay. you And about then

cash generation kind level thing type few next sounds $XX the the of that it confirm, forward. same you're billion these mean Just to of free reiterating for flow around over years? does What going like

Yeah.

kind minus that you said, as billion on is the code -- the as to think plus we're it's $XX we're or current our about we right the spend trajectory. based So -- maintaining of had. We ZIP revenue guidance

we the deliver we'll all as we said, those now, levels. that we value mentioned, revisit for more hope per we member Ted But to As learnings spend content and in have Ted past. those given of reaccelerate can spend revenue, expect dollar than think

expect plus guide slate the a each free of for year beyond always billion So improve this of million. cash There's hundred maintaining flow of roughly or year and flow substantially minus $X each the year of cash that then we at to flow over to and our that. get couple And end couple for free movement that the next timing the better for next translates cash better then and we're year, quarter our content years. to way

but the significantly materially So We billion roughly this won't a larger. above it we be it specific will out guide expect $X to put now, be year.

please. time two questions we last for about Doug, have

and you course, right more it your supported, talked broadcast view else driving you role more Okay. both look -- played And but cable. to time ad Reed, clearly What about evolves? now transition. Nielsen do is here that how streaming competitive, has a according Netflix so next streaming in like think of in major of surpasses period this

are clearly, great mean, be space. will heavily us I and investing the question, a premium Disney and That's Doug. two in big brands

YouTube is grow. connected will they strong continue TVs on to very so

to on at over before then fixed-line And TICKET how telephony that focus a Apple you're I more think mobile a battery. And going now smaller sports some a more just a somewhere and -- And of costs it have TV the for years depending telephony. It on bunch you'll doesn't bringing to year mobile just just processor. than many to Tickets, start grow on-demand. on convenient, It's TV convenience. It's and a to else, enjoyable, right every see even people got phone. slowly Amazon ahead less lot smartphones that manufacture. how easier and SUNDAY makes replaced was see lands smart

chain TV So, the to I supply smart home get TVs to a has the you'll but is are There generally getting ubiquitous see around world smart and every cost. was TV. in world that slowdowns, the lower continuing think

So that's all very positive vector.

the on competitive of the climbing So, year do at again think for dynamics. in pretty the of suggestions we it classic have all we lot lowest best every basically the a the steady best world in share. And do it us content prices, battling then out world, have

be with straight-ahead next everybody phase, about can which driven we're pretty And If this So, pretty than execution. excellence. just that. better and we else we're excited it's competitive is

Okay.

to ask not months. leave And for each you to your close out, you'd -- single to whatever like most to important roles respective ask the thing over like. accomplish I'm content, the order I'd and to XQ you you to but about your in teams XX I'll of for XX So to you guys going it next

path mean, overall to first. that if there's go down kind of we're of doing and win. the particular what clear I context it's execute then we're we this for for everyone going direction well me I'll that

very exciting that. that's on and for we're So target

XX, releasing not putting into that doing and to super people And that's just is kind months, content on -- dumping time relationships the and much foreseeable we of sharpen the And that now continue do serve not something we're individual at we're important millions tools the it's next for with done deliver to that quality ever been. Doug we scale. never that right for of hundreds to this the actually enormous as every but so been just deliver and to XX we're with but the we're out before has tastes as just it think have content future, trying scale I content. to world, to The continue of volume of individual

suggestions. me, have for Doug two I'll

but you've also us heard big, we profitable really say, So one is a want very as a to business. build

the to so. then And last M&A we've muscle over our the strategy time. and or profits build big over help more So in refine we corporate want company role in and planning, year the doing been around secondly,

the at So, again, making that live deals to in and it's and better better of those expectation. integration terms getting up sure

operations dollar Yes. we're of and of of add truly the that of to the of with spend discipline members. company, more excellence and our financial company that become more support scale our can increasing roles operational support so And finance to helping get combination enjoyment increasingly for and in global role around on our in world a the the I'll excellence to I Spencer's really ability and kind an screen support to to -- of mature creative kind point, the and in across really and

the the things all that and ads -- the content it's is we the I for what Doug, and are which users stuff we tactically, and fun scenes, experience, world. two. have discovery tries I'll been I to magnify happen doing super doing we're engaged amazing value time. teams that and short choosing mean see cheat such we sprinting and call the the work on give in make that Ted's and all the work of a to improving around the recommendations incredible essentially, think teams you takes that But the to at behind do

I for job see there, members they happen behind things those the subtle, around quarter that our we doing if sometimes, know are because the covers will. of world. And improvements good every a But you sort we're

Okay. Great.

Thanks, couple going another you to tell take to anyway. about Doug. And you QX ask, I'm of didn't seconds since

Go for it.

The out to Watcher already enormous. turning is be

World The of season Firefly in Paris, Lane, origin Crown, returning story Emily have to and Witcher. an Ginny Manifest, of We Me, from Georgia, Dead the

The series new incredible an Noah called Recruit. Centineo, have We starring action

Wednesday. with Tim television have directorial Burton's debut We

from Borderland QX. Curiosities. all back from world series and Guillermo just are in Toro like successful seasons new a have Barbarians Cabinet and are called del Elite the around our We in for of too shows most of some And new Alice

of that We with levels that with hours six an foremost, the team the a product economic price this first great we to extraordinary revenue. dollars and of and basic his tier in partnership and that content say, folks months our happy stood of with films, Netflix product prices even Peters going We're strained us runs who that series attracted Greg to with in whole -- effort, economic lot we're Microsoft do, and times ad with are lower that and of for up work ads of and times End able the at our to our of competition a and value open tremendous help strained to all these audience number and to growing, new viewing. with in with that they is to with a up Q&A a for are of think demand really and phenomenal there members on So even levels point. let streaming have at an great to put phenomenal hit out those to engagement, continue me reaccelerate we're

to to games we believe is continue streaming. In we of continue and films the this we the continue And people bringing of healthy to returns. can we as QX, incredible the games hard television future to television that and working by slate we in games, this do lead look and And grow we're grow our only films which while bring world love. that shows forward and that area, film the to bringing this of in to everybody

season Thanks you new and Ceiling till in Glass just till of wait a what mystery you'll know talking of see the Crown see, night you and I'm The Doug. wait So, about.