Is Netflix's Foray Into Video Games a Giant Misstep?

Big news reverberated across the entertainment industry in late 2021 when Netflix (NASDAQ: NFLX) announced it had started developing mobile games for its subscription service. Launched in November of last year, there are now five mobile games that subscribers can access on their phones as a part of the Netflix subscription bundle, with many more to come in future quarters.

Some investors celebrated this development as an opportunity for Netflix to enter a new, lucrative business line that could help the company grow for many years to come. But given the intricacies and technological limitations of the video game industry, it is hard to see how Netflix can get a strong return on these video game investments.