Here's everything you need to know about the world of television for Tuesday, October 21st, 2025:
THE STREAMING INDUSTRY APPARENTLY DOESN'T UNDERSTAND THE WORD 'TRANSPARENT'
Late Tuesday afternoon, Netflix will release third quarter earnings numbers to investors and the press and you will no doubt read tons of frantic thought pieces about the overall success or failure of the quarter. But what do we really need to know about the numbers?
First, while the public will hear a lot of data points being tossed around by company executives touting viewing numbers with little or no context, and Wall Street analysts parsing the earnings numbers, very little of that will really tell you how well the company is actually executing its strategy.
First, here are the raw numbers that market analysts will be watching:
-
Revenue: $11.52 billion versus $9.82 billion last year; Netflix guidance: $11.53 billion
-
Earnings per share (EPS): $6.94 versus $5.40 last year; Netflix guidance: $6.87
Analysts will also be watching advertising revenue, which analysts expect will more than double from $1.4 billion in 2024 to $2.9 billion in 2025 and increase another 45% to $4.2 billion by 2026.
Netflix no longer reports detailed membership growth metrics, a decision which doesn't bother me too much in the abstract. Netflix - and increasingly, other rivals - argue that a focus on raw subscriber numbers provides the wrong incentive for streamers. Not all subscribers are the same and as one Netflix executive told me, 200,000 subscribers from a country with a high ARPU (average revenue per user), can be worth more than 2,000,000 subscribers with a low ARPU and a high churn rate. So focusing just on subscriber growth can be misleading.
But if Netflix isn't providing overall subscriber numbers - much less numbers broken out by region - and is also providing less information on regional ARPU numbers, how does anyone judge the strategic success of the company? Sure, we have the overall revenue numbers, free cash flow, earnings per share and the other top line numbers. But how do we judge what's under the hood of the company?
I apologize in advance to some of you, because this is an extremely abbreviated explanation and I know I am glossing over many important things. But this is not a novella.
In the old broadcast and cable world, making money and determining value was complicated, but the general outlines are easy enough to be understood by most civilians. You produce some programming, and hopefully it draws enough viewers to allow the network to sell enough ads at a price where there's a profit. And yes, there was network branding that played into that as well as things such as carriage subscription fees once cable television rolled out. But because viewers could turn the channel whenever they wanted, the primary driver for any network was to get as many eyeballs at any one particular time as possible. That is how you made money. And it was fairly easy to track these metrics from outside the company.
SVODs such as Netflix have a business model that couldn't be more different. Because viewers have to make the conscious decision to subscribe (and to keep subscribing), the economic factors that matter the most are the ones that revolve around the cost of finding the subscribers and keeping them happy enough to pay up every month. Simple viewing numbers don't provide much clarity on those two important metrics. So the focus is on something called "customer lifetime value."
You figure out your customer acquisition cost (CAC) - or what you have to spend for each person who subscribes - and measure that against the customer lifetime value and you have a pretty good metric to use to help determine how much you should be spending on everything from salaries and marketing to content production and overhead.
Simply put, the customer lifetime value is the total worth of each customer throughout the life of your relationship with them. That includes all sorts of data points, ranging from how long each subscriber is likely to stay before churning off, the price they're paying each month, etc. If you can accurately figure that out, you can compare the customer acquisition costs to the customer lifetime value and use that to help you predict a wide variety of future business decisions.
It's not just whether or not you'll be profitable, but it helps you to make all sorts of related strategic decisions. If accurate, it gives you a bird’s-eye view of your marketing expenses, efforts, campaigns, and strategies. You can use it to balance short and long-term financial goals. You can figure out which spending is bringing the best return and where to focus future efforts.
It can also help you identify high-value customers. In the case of SVODs, that means customers who are likely to stay subscribed for a long period of time.
The related side of this is that you can also determine which decisions might help that overall customer lifetime value. Increasing that CLV at a rate lower than you are increasing spending is basically increasing your revenue stream and your profits.
When applied correctly, that CLV number can be used to help determine what content is most valuable to the bottom line. For instance, a show that draws in an above-average number of new subscribers (which lowers customer acquisition costs) would have more value to a streamer than another series that generates five times the views, but many fewer new subscribers. And as you can imagine, there are all sorts of variations of this equation.
Each streaming company has a different series of data points it tracks and none of the approaches seem to be compatible with each other. Streaming services can't even agree on what qualifies as a "view," much less come to a consensus on what CLV looks like in a streaming-forward world.
And the problem is exacerbated at some of companies (Warner Bros. Discovery, I'm looking at you), when the decision is made to tweak the equations in order to justify business decisions you've already decided to make.
In the abstract, CLV is determined by this equation:
Customer Lifetime Value (CLV) = (ARPA × Gross Margin)÷ Churn Rate
In other words, you estimate the average revenue per account by the gross margin and divide by the estimated subscriber churn percentage each month.
But while that formula sounds straight-forward enough, if you are wrong in any assumption, your bottom line can quickly go sideways.
And the problem with trying to determine the success of any streamer - Netflix included - is that we don't know any of those numbers. Netflix may be profitable, but there is no real way to know the specifics of why from outside the company. Netflix executives will tout a bunch of viewing numbers for some of their hit titles during the earnings call, and that's all well and good. But viewing numbers don't tell is anything about the financial success or failure of a specific title, much less the entire company. They are just a bunch of interesting factoids, delivered without context.
One thing we can watch for during the earnings call are the topics executives brush off or don't want to discuss in detail. Those items are likely the ones in which the company is less happy with its success. Then journalists and analysts have to figure out why those topics were important to downplay and what that says about the company.
I don't expect Netflix or any streamer to open their books and provide all the relevant financial metrics they have available internally. I do wish they would be transparent enough to deliver the minimum data points we need to accurately judge the success of the company's strategy and its financial health.
DID THE JIMMY KIMMEL BOYCOTT HAVE AN IMPACT ON HULU AND DISNEY+ CANCELLATIONS? WELL.....
I am not going to spend a lot of time on this, but I did want to highlight a story that seemed to be everywhere on Monday. The analytics firm Antenna released data showing the churn rate for Hulu and Disney+ spiked from August to September, leading to headline such as this one on Deadline: "Disney+, Hulu Churn Rates Spiked Around Jimmy Kimmel Suspension, Antenna Says."
Last month’s suspension of Jimmy Kimmel Live! coincided with a doubling of subscriber churn rates on Disney+ and Hulu, according to the latest streaming report from Antenna.
Churn, the industry term for the number of subscribers canceling their service in a given period, hit 8% on Disney+ and 10% on Hulu. Their levels in August were 4% and 5%, respectively.
Wow, that sounds pretty definitive. Except for a couple of problems. Antenna attempts to track subscriber grow and churn. But the company can't track the intent of subscribers. It has no idea WHY there was a jump in cancellations at Hulu and Disney+. Although buried at the bottom of the Deadline story is some context that suggests a reason:
Additionally, it wasn’t just Disney seeing elevated churn in September. HBO Max hit 9% churn, up from 8% in August, and the weighted average of all services climbed to 7% from 6%, with Starz, Paramount+ and Apple TV all on the rise. That trend is in line with data from Nielsen on overall TV usage in September, annually a time when football has keyed a resurgence in pay-TV viewing and a pullback from streaming in recent years.
In recent years? I wonder what the churn numbers looked like last year? We don't know, but that certainly would be an interesting point of comparison.
And while the increased churn rate is highlighted, another data point also pushes back against the Kimmel boycott-related narrative:
Antenna, which tracks subscriptions via a range of consumer and financial data, also found that sign-ups to Disney+ and Hulu in September rose not only from August but hit their highest level in five months.
Wait...what? Sign-ups INCREASED in September? Hmm, I wonder if more people signed up than cancelled Hulu and Disney+. Well, we don't know that, because Antenna doesn't seem to have released those numbers.
I have no doubt that the Kimmel boycott had some impact. But there are a number of other factors in play here. Notably, that a number of cable companies and streaming services have been rolling out new add-ons to subscribers, which provides free ad-supported versions of Hulu & Disney+. The catch is that in order to get the free deal, you have to cancel your current Hulu and/or Disney+ account. It can't be transferred over. And since there is no way for Antenna to track those moves, there is no way to know how much of an impact that had on the current subscriber number shifts.
So did the Kimmel boycott have an impact. Probably. Although despite the headlines in the industry trades, there is no way to know how significant it might have been.
READER FEEDBACK
My reporting from yesterday that highlighted a long-running text chain involving CBS News employees received a lot of attention and sparked a large number of comments and emails. Here are a few of my favorites, which includes people who enjoyed the piece. And those who didn't:
"Covering leaked personal gossip as news is the worst the offenses. Please do better for the sake the industry's sake. Thank you."
-- Ian R.
"I appreciate the insight that your CBS News story provided and think it speaks volumes that your source was willing to share it with you. That you reported it to maximize the news while protecting the shit-talkers (there truly is little that is more American), is a feather in your cap. In this worst timeline, when so many heretofore unseen media spectacles are blowing up around us, we can use all the inside baseball we can get to try to get out of this mess and figure out how to ensure we never end up in this shackled-press predicament again."
-- YoungHolli
"whoever said "she doesn’t own a tv? Hi, I’m the head of the FAA & i’ve never been on a plane!” in the gc deserves a netflix special."
--Adriana
TWEET OF THE DAY
ODDS AND SODS
* Hulu has landed U.S. rights to Innate, an upcoming psychological thriller from Fran Carballal (Cicatriz) and Enrique Lojo (En Fin) that was commissioned by Netflix’s Spanish division.
* Prime Video Australia and New Zealand has canceled the Australian reboot of The Office after one season.
* The long-running Food Network show The Kitchen is ending after ten years on the air. The final episode will air Saturday, November 13th.
* Hulu has ordered its reboot of the Fox show Prison Break to series.
WHAT'S COMING TODAY AND TOMORROW
TUESDAY, OCTOBER 21ST:
* Armed Only With A Camera: The Life And Death Of Brent Renau (HBO)
* Catch & Release (MHz Choice)
* Frontline: The Rise Of RFK Jr. (PBS)
* Michelle Wolf: The Well (Netflix)
* NBA On NBC Season Premiere (NBC)
* NBA Pre-Game Show (NBC)
* Who Killed The Montreal Expos? (Netflix)
WEDNESDAY, OCTOBER 29th:
* About Face Series Premiere (TLC)
* Ballad Of A Small Player (Netflix)
* Bigfoot Took Her (Discovery)
* Disney Twisted-Wonderland: The Animation (Disney+)
* Down Cemetery Road Series Premiere (Apple TV+)
* Ghost Adventures (Discovery)
* Hazbin Hotel Season Two Premiere (Prime Video)
* Hedda (Prime Video)
* Ink Master Season Premiere (Paramount+)
* Nova: Super Floods (PBS)
* Rulers Of Fortune Series Premiere (Netflix)
* Selling Sunset Season Nine Premiere (Netflix)
* Star Wars: Visions Season Three Premiere (Disney+)
* Ten Pound Poms Series Premiere (Britbox)
SEE YOU EARLY WEDNESDAY MORNING!