Netflix is shifting its focus to profit and revenue by stopping the release of subscriber numbers in 2025.

• Netflix announced in its first-quarter shareholder letter that it will discontinue reporting quarterly subscriber growth.
• Netflix's potential slowdown in subscriber growth next year may be due to its crackdown on password sharing.
• Netflix is signaling that it wants to be evaluated based on mature metrics such as revenue, earnings, and free cash flow.

The most effective way to make investors stop concentrating on something is to cease mentioning it altogether.

Starting in the first quarter of 2025, it was announced on Thursday that the company will no longer provide quarterly reports on membership numbers and average revenue per membership.

Netflix wants investors to evaluate the company based on the same metrics that executives consider as "our best indicator of customer satisfaction," as stated in the quarterly shareholder letter.

The amount of time spent on Netflix is directly related to revenue, operating margin, and free cash flow.

Netflix's global password sharing crackdown and introduction of a less expensive advertising tier led to the addition of 9.3 million subscribers in the first quarter, indicating that the company's second wave of subscriber growth may be ending. The ad tier costs $6.99 per month in the U.S., as opposed to its $15.49 standard plan.

The company expects subscriber growth in the second quarter to be lower than in the first quarter because of "seasonality." This could signal a longer period of slowing subscriber additions, as many freeloading password sharers have now become paying customers.

In the quarter, the growth rate of ARM, defined by Netflix as "streaming revenue divided by the average number of streaming paid memberships divided by the number of months in the period," was only 1%.

Netflix's after-hours trading saw a 4% decline, partly due to lower full-year revenue growth expectations from some analysts. Netflix forecasts a 16% revenue growth rate in the second quarter but anticipates a range of 13% to 15% for the full year.

Netflix is cutting back on granular membership information, which it used to pride itself on, including regional breakdowns that were more specific than all of its competitors. Apple and Amazon have never offered quarterly subscriber information for its streaming services.

Netflix's maturity as a company is evident by its focus on revenue and profit, rather than user growth, as it has been disrupting legacy media for over a decade.

Currently, Netflix is the leading streaming service after five years of competition in the streaming industry.

Netflix stated in its shareholder letter that in its early days, when it had minimal revenue and profit, membership growth was a significant indicator of its future potential. However, now that the company generates substantial profit and free cash flow, it has developed new revenue streams such as advertising and an extra member feature. As a result, memberships are just one aspect of its growth. Furthermore, Netflix noted that as it has evolved its pricing and plans from a single to multiple tiers with varying price points based on the country, each incremental paid membership has a distinct business impact.

Netflix's finances are healthier than most legacy media companies, allowing the company to focus on profit, revenue, and free cash flow. Year-over-year revenue increased by 15%.

The operating income of the company increased by 54%, and the operating margin rose by 7 percentage points to 28%. This growth surpasses companies such as Netflix, Amazon Prime Video, Hulu, and NBCUniversal, which have unprofitable streaming services and declining traditional TV businesses.

Will other media companies follow Netflix's lead and stop reporting subscriber numbers for their streaming services? Many of the legacy media companies have not yet implemented password sharing crackdowns like Netflix, which may indicate they have more growth potential. Investors would likely be interested in seeing this growth.

Co-CEO Greg Peters stated during the company's earnings call that they have evolved and will continue to do so. He explained that the historical math used to assess the business state is becoming less accurate.

Disclosure: Comcast NBCUniversal is the parent company of CNBC.

Mark Mahaney of Evercore praised Netflix's quarterly subscription growth, calling it "really impressive."