Could Netflix Be Getting Into Video Games? Earnings Call Hints At A Move

Netflix Inc NFLX reported first-quarter earnings after the close Tuesday night with shares of the streaming giant falling after the company missed original subscriber growth figures.

The company is boosting its content slate for the second half of the year and hinted at adding video games in the future.

What Happened: Netflix was asked some questions about video games during the company’s earnings call.

“In ways, we’re kind of in gaming now with Bandersnatch and we have some very interactive things,” Netflix Co-CEO Reed Hastings said.

Netflix Chief Product Officer Greg Peters added more color to the company’s business of creating content.

“We’re in the business of creating these amazing, deep universes and compelling characters and people come to love these universes and want to immerse themselves more deeply and get to know the characters better and their backstories and all that stuff,” Peters said.

Netflix is working on figuring out how to deepen the fandom. Peters said games are an interesting component of that.

“Whether it's gamifying some of the linear storytelling we’re doing like interactive, Bandersnatch, and the kids interactive programs, that’s been super interesting,” he said, adding, “We’ve actually launched games themselves. It’s part of our licensing and merchandising effort, and we’re happy with what we’ve seen so far.”

Peters said games will be an important form of entertainment for fans going forward and Netflix is “going to keep going” in the segment.

“And we’re a business that continues to learn," Netflix CFO Spencer Neumann said, "and so far our learning has been — it's been good learnings. We're happy with how it's played out. And hopefully, we’ll continue to kind of learn from here.”

Related Link: How Netflix Is Preparing To Combat The Lighter Content Slate That Affected Q1 Growth

Why It’s Important: Netflix has many original shows that have seen large fandoms form. The content could be turned into video games to increase the show’s awareness and also carry out monetization after shows end their run.

Netflix could choose to build up its own gaming studio or partner with an existing one to license its content out.

Netflix has more than 200 million subscribers around the world, which creates a great base of potential customers for games launched by Netflix or with content from Netflix shows.

NFLX Price Action: Shares of Netflix are down 7.26% to $509.68 on Wednesday morning publication.

(Photo: Netflix)

Posted In: Reed Hastingsstreaming stocksVideo Game Stocksvideo gamesTrading Ideas

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