Thread by @titanvest

At Long Last, $NFLX Goes Gaming: Titan's Take

This week, Netflix announced that Mike Verdu would be its new Vice President of Game Development, leading the company’s efforts to expand into the fastest-growing entertainment medium around. /1

The $NFLX executive team has hinted at a more forceful move into gaming, even mentioning the popular game Fortnite as a direct competitor. /2

Verdu brings a wealth of expertise at building out game portfolios -- precisely what $NFLX needs to monetize its growing base of IP and drive user engagement, especially in mature and developed markets. /3

At $NFLX, concerns have intensified around lackluster net subscriber additions, which fell significantly below consensus, as reported in the company’s latest quarterly report. In the shorter term, building out gaming products should drive subscriber growth in younger cohorts. /4

At Titan, we focus on the longer-term dynamics, and through that lens, we see this as another strategic move by Reed Hastings that we believe is critical to Netflix’s staying power as an entertainment platform. /5

We view $NFLX's move into gaming as a logical supplement to its content strategy, enabling further monetization of its IP. We expect that a successful gaming product will increase retention and engagement, further supporting pricing power for Netflix. /6

The streaming wars and the gaming surge were bound to converge, as entertainment giants fight to capture audience attention in its most devoted forms. $NFLX, in typical fashion, is leading the way.

For more, check out our latest research update: titan.com/research/2021/… /7