A year ago, Netflix (NFLX 1.95%) was in a challenging position; the on-demand streaming service had shed subscribers for the first time in more than a decade, and some were asking what the company could do to reignite growth. Twelve months on, and the streamer has not only stemmed its losses, it has even grown its subscriber numbers.

Considering what Netflix has done over the last year -- and what it has outlined for the future -- can we game out where the company's stock might be five years from now? Let's explore.

Dealing with the 100 million problem

According to Netflix's own estimates, approximately 100 million people are watching the company's content using someone else's account -- something that has long been against the streamer's terms of service. To deal with the issue, Netflix has introduced additional fees around the globe, charging customers extra when they share their login details with other households.

Netflix was supposed to introduce subaccount charges in the U.S. during the first fiscal quarter of 2023, but the company recently pushed back that plan to sometime in the current quarter.

Speaking about the decision, Netflix co-CEO Greg Peters noted the company had witnessed an "initial cancel reaction" in response to the fees in other territories and suggested the delay will allow it to "incorporate those learnings" so as to lessen the impact on the U.S. market.

It's worth noting that an Aluma Insights study last year found 13% of U.S. Netflix subscribers said they would consider canceling the service if the company tried to charge them as little as $3 extra a month for password-sharing. But if Netflix can introduce those charges without triggering significant churn, then it's reasonable to think that, a few years from now, consumers will be less averse to paying a few bucks extra to share their accounts. The company has raised subscription prices several times in recent years with mixed effects on subscriber growth. 

Netflix is poised to benefit from AVOD's growth

Netflix introduced Basic with Ads -- its $6.99-per-month ad-supported video-on-demand (AVOD) offering -- in November 2022. The streamer had reportedly told marketers that it expected the tier would attract 40 million viewers by the end of 2023, though the company was soon refunding advertisers because it was not seeing enough sign-ups.

Despite the early struggles, Netflix believes Basic with Ads is showing promise. Speaking during the company's Q1 2023 earnings interview, Netflix CFO Spencer Newman said the Basic with Ads plan was delivering a higher average revenue per user (ARPU) than its standard Basic offering. Newman also noted that in the U.S., the ARPU from the ad-supported tier is also outperforming Netflix Standard, which costs $15.49 a month.

For Netflix stakeholders, the streamer's confidence in Basic with Ads is promising, particularly given how experts see the market shaping up over the coming years. Analytics firm Digital TV Research has projected the AVOD space will generate $91 billion in revenue in 2028, up from $41 billion in 2022.

A future in games

KBV Research predicts the worldwide video game industry will be valued at $413 billion by 2028, which, if correct, will be a notable rise from the $191.2 billion it was worth in 2021. Such a projection is encouraging for Netflix, which has made clear it sees video games as key to its future.

The streamer entered the games industry in November 2021, releasing a batch of iOS and Android titles that are available exclusively to its subscribers. Since then, Netflix has outlined plans to get into cloud gaming, saying it wants to make its games playable on all devices that currently support its video content.

On this front, the forecasts also look good for Netflix: According to Fortune Business Insights, the value of the global cloud gaming industry could grow from $3.24 billion in 2022 to $40.81 billion by 2029.

Netflix in 2028

With subaccount charges, an ad-supported offering, and talk of cloud gaming, the Netflix of today is very different from the Netflix of a year ago. If the company can continue to execute its strategies, there's every possibility it will be an even more dynamic company five years from now, with a stock price that reflects that.

Of course, there are still risks ahead: U.S. consumers could broadly reject the streamer's account-sharing fees, and cloud gaming is still relatively niche, even though the technology has been around for 20 years. Nonetheless, Netflix is committed to these strategies as long-term plays.

Stakeholders should pay attention to Netflix's second-quarter earnings report in July to see what the company shares about these plans and just what impact they're having on its bottom line.