Who's Watching? (NFLX Earnings)
Netflix (NFLX) is set to release its Q3 results today, with a video call at 6pm ET.
FactSet consensus projects a 13% year-over-year EPS increase at $3.49 and an 8% revenue boost to $8.54 bln
Historically, NFLX emphasized global streaming paid net adds, but the focus is shifting towards total revenue and profitability.
Concerning net adds, Q2 recorded a gain of +5.89 million. Positively, NFLX will be comparing against the more modest Q3 figures from the previous year, which were +2.41 million. However, Q4 presents steeper challenges.
Netflix still offers guidance for its operating margin.
During the call, there'll be keen interest in the progress of the password sharing crackdown. In the Q2 discussion, while NFLX advised of extended business impact durations, they also highlighted that users were opting for plans resembling those of longer-term members. Precise figures regarding subscription terminations and new additions were, however, not disclosed.
Another focal point is the performance of the newly-introduced advertising model. In the Q2 conversation, Netflix mentioned a weak ad market.
Additionally, there's anticipation around Netflix's perspective on the actor strike. There's a belief that NFLX stands in a favorable position given its international sources unaffected by the strike.
TECHS:
In terms of predictions, NFLX has surpassed EPS estimates in 7 out of the past 8 quarters. The net add metrics, alongside the password policy and ad model, might introduce unpredictability.
Technically speaking, theres an air pocket below the $330 mark.
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