• Netflix cut its content spending by more than $1 billion during the first quarter, compared with the same period a year earlier.
• The streaming is generating more cash as subscriber growth slows by cutting content costs.
• The development comes after Hollywood writers voted to authorize a strike as they seek more pay.

There's overwhelming support among Hollywood writers to strike for more money. But their timing is far from ideal.

Netflix revealed Tuesday it spent $2.5 billion on content in the first quarter. That's down from $3.6 billion in the first quarter a year earlier, according to its earnings report.

Like other media companies, Netflix appears focused on boosting free cash flow rather than cranking up spending to add more subscribers. Netflix's total subscriber count in the U.S. and Canada barely budged in the first quarter. The company gained just 100,000 subscribers. Netflix ended the quarter with 74.4 million subscribers in the U.S. and Canada — about 200,000 subscribers less than it had a year ago.

Netflix added 1.75 million subscribers globally, a far cry from the 10 million-plus subscribers it used to add in quarters during the pandemic. Even still, Netflix raised its full-year free cash flow estimate to $3.5 billion from $3 billion.

The company is generating more cash as subscriber growth slows by cutting content costs. Netflix promised overall content spend in 2024 would be $17 billion — about the same as it's been in 2022 and is expected to be in 2023.

But if that amount is cut, Netflix's new investor story of boosting free cash flow may not be derailed.

That's bad news for writers who want to get paid more. The incentive for big studios to capitulate on pay may not be the same as it was during the pandemic, when media companies were still increasing content spend in an arms race to gain subscribers. LightShed media analyst Rich Greenfield noted that when production shutdowns happened during the pandemic, Netflix's free cash flow soared then, too.

"Multi-billion dollar operating losses could come in significantly better than expected with free cash flow also ending up being far greater than expected -- remember how Netflix free cash flow came in far better than expected during the pandemic," Greenfield wrote in a note to clients. "While there is certainly the potential that less "fresh" content in the back half of 2023 or lower quality content due to a lack of script edits will hurt streamers, we believe that impact is dwarfed by the cost savings from a production halt."

The company nonetheless hopes to avoid a writers' strike, co-CEO Ted Sarandos said during Netflix's earnings video presentation Tuesday.

"We respect the writers and WGA and we couldn't be here without them. We don't want a strike," Sarandos said. Still, if a strike did happen, Netflix has a robust slate of TV series and movies ahead, he added.

A writers' strike could put more emphasis on Netflix adding live programming — something the company is clearly still struggling with.

Still, Netflix seems prepared to weather a writers' strike — because it's already getting permission from investors to cut content spend without one.

Netflix shares are up about 13% so far this year as of Tuesday's close. They were down slightly during after hours trading.

–CNBC's Lillian Rizzo contributed to this report.