Netflix tried to get ahead of some bad news this week by hyping a gaming announcement, part of the company’s strategy to pep up investors worried about the streaming giant’s future.

Why it matters: Netflix reported its first-ever quarterly loss of subscribers yesterday, triggering a full season’s worth of takes to binge-read.

• Execs are floating offering cheaper ad-supported tiers and cracking down on password sharing.
• They’re also talking a lot about games.

The details: Netflix announced a mobile game and animated series based on the card game Exploding Kittens on Monday, which offers “an early glimmer” of its gaming strategy, company COO Gregory Peters told investors yesterday.

• The mobile game is set to launch via Netflix’s phone app next month, with the animated series to follow next year.
• Future versions of the game will have elements from the series, and “all art and design will be inspired by the show,” a Netflix rep told Axios.
• That kind of “interplay,” as Peters put it yesterday, is “an initial step on a long road map” for linking its show and movie content to its games.

Netflix currently offers 17 games, with four more announced for May.

• Gaming is not yet based on the splashy originals model, as Netflix initially builds its mobile gaming library with titles that mostly have or will appear on other platforms too.
• The May offerings include a new release of casual dragon-hatching game Dragon Up and a port of the more complex Moonlighter, a 2018 indie game about owning a magical weapons shop by day and going on monster-slaying adventures at night.
• The company has acquired three game studios since September, setting up potential for homegrown exclusives. (Yesterday, Co-CEO Reed Hastings called them “small acquisitions to build up the know-how and the creative chops to be able to make some really great games.”)

Between the lines: Netflix’s gaming plans currently look like a subscriber retention effort and marketing play rather than a plunge into direct competition with gaming’s biggest companies.

• Netflix’s initial moves are focused on giving people more to do with their Netflix app.

Be smart: Gaming is a notoriously hard business to make money in, but Netflix sees gold there.

• “We think that we can build a big revenue and profit stream by adding games,” co-CEO Theodore Sarandos told investors.
• It’s a more viable move at the moment, he added, than adding live sports.

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