With this backdrop, Netflix reports its third-quarter results on Wednesday after the stock market close, with a conference call at 3 p.m. But we want to balance it with being able to invest in all that big growth opportunity, that big prize … in terms of those big addressable markets. And we would expect to do that going forward in ’24 and beyond. “Our priority is to accelerate revenue growth, and as we do that, then to start ticking up margins again,” the CFO told the investor conference. For this year, the streamer continues to target 18-20 percent. After a 21 percent operating margin in 2021, Netflix reported a 17.8 percent margin at the end of 2022. “We’ve got a lot of work to do.”Īnd Neumann signaled that margin growth would also be more gradual as the company invests in growth opportunities. “We’re still in the crawl of the crawl, walk, run stage,” the Netflix executive said back then about the state of the company’s advertising business. Mid-September comments from Netflix CFO Spencer Neumann at a Bank of America investor conference have also given some pause or a reason to re-evaluate some of their expectations. 13.ĪRM, average revenue per member, also known as ARPU, average revenue per user, has been one of the key investor debates about the stock, with a focus on how stronger subscriber growth momentum in international markets with lower ARMs and how the crackdown on password-sharing households is affecting the metric. “While there may be a long(ish) tail of sharers still to come, sharers are not great members,” argued Wells Fargo analyst Steven Cahall in a recent report, of password sharing accounts. “Third-quarter ARPU guidance implies dilutive tier trading, and the stock will likely struggle to work on higher subs but lower ARPU.” For the year-to-date period though, Netflix’s stock is still up around 20 percent as of Oct. Since its last earnings report on July 19, Netflix shares “saw a reversal in stock performance, with shares down 22 percent versus the S&P 500 down 7 percent on the back of investor concerns,” Goldman Sachs analyst Eric Sheridan noted in an Oct. Their takeaway: Wall Street expectations may have become a bit too exuberant near-term. Indeed, some analysts have revisited and tweaked their earnings forecasts and reduced their stock price targets. And any insight into the financial impact of the streamer’s password-sharing crackdown will also be closely watched. Netflix executives also have signaled a possible increase in spending on licensed content. 'Twisters' Trailer Spins Into Super Bowl With Glen Powell, Daisy Edgar-Jones “Building an ads business from scratch isn’t easy and we have lots of hard work ahead,” Netflix leadership said in a letter at the time. That is because shares in the streaming giant, run by Ted Sarandos and Greg Peters, have been losing ground since then as investors have been evaluating its earnings outlook amid cautious management comments about the growth of the firm’s nascent advertising tier and margins. 18, but you couldn’t tell that from the stock’s performance since the global streamer’s July earnings update, when it added 5.9 million subscribers to total 238.4 million global paid memberships. Netflix is expected to post strong subscriber gains when it reports its latest quarterly results on Oct.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |