Netflix Q2 Subscriber Losses Could Be Worse Than Forecast, Analyst Warns

July 07, 2022

https://liquidity-provider.com/app/uploads/2022/07/untitled-design-4.png

Nearly three months have passed since Netflix startled investors with a terrible first-quarter earnings announcement. A surprising reversal in subscriber growth was the main problem. In the March quarter, Netflix lost 200,000 net members, and it anticipated losing 2 million more in the June quarter.

Netflix (NFLX) attributed the decline to growing rivalry, password sharing, and a bump from the Covid period, which the firm now acknowledges covered up certain unfavorable underlying patterns.

Nearly as shocking was the company's co-CEO Reed Hastings' declaration on the earnings call for the March quarter that Netflix is now considering adding a less expensive ad-supported subscription tier, a strategy that rival streaming services have adopted but that Hastings had previously outright rejected. He said that the business is starting to take action to limit password sharing.

Since that news, Netflix stock has decreased by 48 percent.

Investors are naturally anxious since the firm is expected to release its second-quarter results report on July 19. According to reports, Netflix has been cutting jobs in order to address declining performance while pushing an ad-supported membership alternative to the market. But as usual, attention will be drawn to the company's comments on subscriber gains — or declines.

In a research note published on Wednesday, Barclays analyst Kannan Venkateshwar claims that despite recent growth in the company's content slate, which includes the new seasons of Stranger Things, Ozark, and Peaky Blinders, Netflix may once again see a decline in subscriber growth. In his piece, he claims that Netflix is on track to lose 2.8 million subscribers in the June quarter, which is 800,000 more than the company had anticipated. He believes that the corporation would most likely record a sequential decrease in subscribers for the U.S./Canada area in particular since, according to his study, the region's daily average user growth was negative in May.

While the fourth season of Stranger Things' debut did initially cause a rise in app downloads, according to Venkateshwar, the effect doesn't seem to have been very significant. Given the increasing competition from Walt Disney (DIS), Apple (AAPL), Warner Bros. Discovery (WBD) unit HBO, and Amazon.com (AMZN), he believes Netflix may need to raise the bar on quality.

The Barclays analyst keeps the stock's Equal Weight rating but lowers his target price to $170 from $275 and cuts his expectation for 2023 earnings to $11.15 per share from $11.98; this is less than his estimate for 2022 profits of $11.36 per share. The market anticipates a share price of $10.90 this year and $11.95 the next year.

Venkateshwar adds that using a multiple of Ebitda, or earnings before interest, taxes, depreciation, and amortization, Netflix shares still trade at a premium over both Alphabet (GOOGL) and Meta Platforms (META), even after their precipitous plunge. The stock "may not bottom until earnings multiples are more equivalent to legacy media stocks," he argues, assuming "[subscriber] growth expectations keep drifting downward."

On Thursday, Netflix shares fell 1.6 percent to $183.01.

Subscribe Our Newsletter

The Queen of England Has Died. Here is Why She Was Important to the Economy
The Queen of England Has Died. Here is Why She Was Important to the Economy

At the age of 96, Queen Elizabeth II passed away on Thursday. The City, the financial district of London, will be where people will remember the Queen the most.

Stock Market News Live Updates: Stocks Come Back From Session Lows To End Mixed After Fed Minutes
Stock Market News Live Updates: Stocks Come Back From Session Lows To End Mixed After Fed Minutes

Tuesday's rise in the broad market indexes provided a brief reprieve after a three-day losing skid, but only partially reversed year-to-date losses as worries about inflation and the Fed's upcoming decision persisted.

Stocks
Tamta

Crypto Investing vs. Crypto Trading: What’s The Difference?
You've probably heard the captivating stories of ordinary folks who struck digital gold and turned into millionaires overnight.

discover
What You Should Know About Energy Liquidity?

Liquidity Provider

What You Should Know About Energy Liquidity?

Let's find out, which instruments does the energy market include, what is the role of a liquidity provider in the energy market, how to choose the best liquidity providers and more.

Liquidity

Contact Us

Contact the Liquidity Provider
for any questions and advertising inquiries b2broker

    Please fill out this contact form to get in touch with us

    / 3000

    By clicking “Get in touch” button, you agree to the privacy policy

    Successful!
    Thank you for your request.
    We will contact you shortly.
    Close

    Alexander

    Best Bitcoin Wallets in 2023: Comparing Features, Security, and Usability

    Best Bitcoin Wallets in 2023

    Alexander

    Top Rising NFT Artists to Watch Out for in 2023 And Beyond

    Top Rising NFT Artists to Watch Out for in 2023

    Alexander

    Insuring Your Future: What Type of Insurance to Buy?

    Insuring Your Future: What Type of Insurance to Buy

    Alexander

    Is IUL a Good Investment Strategy? — A Guide for Beginner Investors

    Is IUL a Good Investment Strategy? — A Guide for Beginner Investors

    Alexander

    Are Crypto Wallets Safe? — Tips to Ensure Maximum Protection of Your Digital Assets.

    Are Crypto Wallets Safe? — Tips to Ensure Maximum Protection

    Alexander

    Roth IRA Guide: What It Is and What You Need to Know.

    Roth IRA Guide: What It Is and What You Need to Know

    Alexander

    From Gold to Index Funds and Crypto: Where to Invest in 2023 for Long Term?

    From Gold to Index Funds and Crypto: Where to Invest in 2023

    Alexander

    Understanding Algorithmic Trading: A Guide for Beginners

    Understanding Algorithmic Trading: A Guide

    Alexander

    Stop Vs. Stop-Limit Order: How Do They Differ?

    Stop Vs. Stop-Limit Order: How Do They Differ

    Alexander

    Invest in the Intelligent Future: The Best AI Stock Market Leaders of 2023

    Invest in the Intelligent Future: The Best AI Stock Market Leaders of 2023

    Deborah Middleton

    How MEC Rules Can Impact Your Life Insurance Policy

    How MEC Rules Can Impact Your Life Insurance Policy.

    Deborah Middleton

    Navigating the Ethical Landscape of AI: Challenges and Solutions

    Navigating the Ethical Landscape of AI: Challenges and Solutions

    Deborah Middleton

    Managing Your Financials The Right Way – A Startup Guide 

    Managing Your Financials The Right Way - A Startup Guide

    Anna

    A Beginner Guide To The Crypto Analysis Tools.

    A Beginner Guide To The Crypto Analysis Tools.

    Anna

    A Brief Introduction to Scalping

    A Brief Introduction to Scalping.

    Anna

    How to Invest in Stocks: A Beginner’s Guide

    How to Invest in Stocks: A Beginner’s Guide

    Anna

    Tips On Finding Crypto Liquidity Providers In 2023

    Tips On Finding Crypto Liquidity Providers In 2023.

    Anna

    Forex Liquidity in 6 Questions and Tips on How to Become Successful in Trading

    Forex Liquidity in 6 Questions and Tips on How to Become Successful in Trading

    Anna

    A Brief and Comprehensive Guide to Spot Trading.

    A Brief and Comprehensive Guide to Spot Trading.

    Anna

    What is The Difference Between Liquidity Provider and Liquidity Aggregator?

    What is The Difference Between Liquidity Provider and Liquidity Aggregator?

    Tamta

    What Is SWIFT Banking System?

    What Is SWIFT Banking System?

    Tamta

    How Liquidity Providers Drive The Foreign Exchange Market

    How Liquidity Providers Drive The Foreign Exchange Market

    Tamta

    How to Start Investing In Crypto

    How to Start Investing In Crypto

    Tamta

    5 Best Crypto CFD Liquidity Providers 2023

    5 Best Crypto CFD Liquidity Providers 2023.
    Latest News - Liquidity Provider: Business & FinTech Media
    • News
      • Stocks
      • Banks and Finance
      • Companies
      • Crypto
      • Forex
      • AI
      • Technology
      • DeFi
      • NFT
    • Articles
      • Crypto Payments
      • Trading
      • Crypto Exchange Business
      • Forex Business
      • Fintech
      • Liquidity
      • FinTech Awards
      • Blockchain
      • Investing
      • NFT
      • DeFi
    • More
      • Videos
      • Liquidity Providers List
      • Crypto Payment Providers
    [email protected]

    © 2023 Liquidity Provider. All Rights Reserved

    Privacy Policy Cookie Policy
    This site is registered on wpml.org as a development site.