Netflix's Competitive Position in the Streaming Industry Amid Rising Subscriber Churn and Intensifying Rivalry

The streaming wars have entered a new phase, marked by aggressive price hikes, subscriber attrition, and a scramble for profitability. As of 2024–2025, Netflix remains a dominant force, but its position is being challenged by peers like Disney, Amazon, and HBO Max, all of which are adapting to a maturing market. This analysis evaluates Netflix's financial resilience and valuation attractiveness relative to its key competitors, drawing on the latest revenue, subscriber, and valuation data.

Financial Performance: Revenue Growth and Subscriber Retention

Netflix's 2024 financial results underscore its continued leadership. The company reported $39 billion in revenue, a 15.7% year-over-year increase, driven by 19 million new subscribers added in Q4 2024 alone, bringing its global subscriber base to 302 million according to data. Net income surged 61% to $8.7 billion, fueled by strategic price hikes (e.g., a $2.50 increase for the U.S. Standard plan) and the success of its ad-supported tier, which accounted for 55% of sign-ups in available markets according to reports. This tier grew by nearly 30% quarter-over-quarter, demonstrating strong demand for affordable streaming options.

In contrast, Disney's DTC segment (Disney+ and Hulu) reported 196 million combined subscriptions by Q4 2025, with operating income rising to $352 million for the quarter as per earnings. While Disney's full-year revenue reached $94.4 billion in fiscal 2025-a 3% increase-its streaming segment faces pressure from cord-cutting and competition. Amazon Prime Video, meanwhile, generated $13.5 billion in 2024 revenue, with subscriber revenue hitting $8.89 billion in the first three quarters according to financial data. Amazon's ad-supported strategy also paid off, with advertising revenue growing 18% year-over-year to $17.29 billion in Q4 2024 according to reports.

HBO Max (now Max) reported $8.8 billion in streaming revenue for 2024, with 116.9 million global subscribers by Q4 2024 according to statistics. Its average revenue per user (ARPU) improved from $10.54 to $11.09 between 2022 and 2023, reflecting effective monetization strategies according to data. However, Max's growth has been uneven, with Q3 2025 streaming content revenue declining to $79 million due to international expansion challenges according to reports.

Valuation Metrics: A Tale of Two Strategies

Netflix's valuation metrics suggest a balance between growth and profitability. As of January 2026, the company traded at a P/E ratio of 36.51, significantly below its 10-year historical average of 103.04 according to analysis. Its EV/EBITDA ratio of 13.28 (as of September 2025) is higher than Disney's 12.19 but lower than Amazon's 17.09 according to valuation data. This positions Netflix as relatively undervalued compared to Amazon but slightly more expensive than Disney.

Disney's valuation has improved markedly since its 2020 peak of an EV/EBITDA of 60.13, with its current ratio of 12.19 reflecting stronger profitability according to earnings. Its trailing P/E ratio (15.4–15.89) and forward P/E (16.0–16.47) also suggest a more attractive entry point for investors seeking value according to financial reports.

Amazon's valuation, while robust, reflects its broader e-commerce dominance. Its P/E ratio of 34.94 and EV/EBITDA of 17.09 indicate a premium for its scale and diversification according to data. However, its streaming segment's profitability lags behind Netflix's, with Prime Video's revenue growth driven more by ad sales than subscription margins.

Max, meanwhile, appears undervalued on paper. Its forward EV/EBITDA of 6.32 and P/S ratio of 0.56 are well below industry averages according to statistics. Yet this low valuation may reflect skepticism about its ability to sustain profitability amid high churn rates and international expansion costs.

Strategic Initiatives: Navigating Churn and Competition

The streaming industry's average monthly churn rate in the U.S. has risen to 5.5%, up from 2% in 2019 according to industry analysis. Netflix has mitigated this through price increases, content investments, and the ad-supported tier. Its $16 billion content spend in 2024-focused on high-quality originals like Squid Game season 2 and live sports-has bolstered retention according to reports. Additionally, Netflix's decision to stop reporting subscriber numbers and instead emphasize engagement time and operating profit signals a shift toward long-term value creation according to industry analysis.

Disney has leveraged bundled services and family plans to retain users, while Amazon has doubled down on advertising, integrating 160+ channels into Prime Video to enhance value according to industry reports. HBO Max's password-sharing crackdown and flexible pricing tiers (e.g., ad-supported plans at $9.99/month) have also helped curb churn according to data.

Conclusion: Netflix's Resilience in a Fragmented Market

Netflix's financial performance and valuation metrics position it as a resilient leader in the streaming industry. Its ability to grow revenue and subscribers while maintaining low churn-despite price hikes-demonstrates strong brand loyalty and content differentiation. While competitors like Amazon and Disney offer compelling valuations, Netflix's focus on engagement, profitability, and strategic pricing gives it an edge in a market increasingly defined by retention over acquisition.

However, the industry's structural challenges-rising churn, price sensitivity, and content costs-mean no player is immune to disruption. For investors, Netflix's current valuation (P/E of 36.51, EV/EBITDA of 13.28) appears justified by its financial discipline and innovation, but long-term success will depend on sustaining its content pipeline and adapting to evolving consumer preferences.