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Netflix Q2 2024 Analysis and Future Prospects
Netflix will be the first of the major US OTTs to report second-quarter results tomorrow. The stock has shown a great performance since the beginning of the year, +40%Only Nvidia (+166%) and Meta (+43%) did better. The most anticipated data is that of subscribers. Netflix is expected to add its fewest subscribers in five quarters in the April-June period, but it increased its earnings thanks to a crackdown on password sharing. It is also worth noting that viewers’ attention has shifted to summer sporting events, including the European soccer tournament.
According to data released by the financial analysis company Lseg, new subscribers would be 4.82 million. This would be the lowest number of subscriptions since the first quarter of 2023, about half of the 9.3 million added in the previous three months. However, The streaming giant’s efforts to sell lower-priced subscriptions but with ads have produced strong growth in ad revenue. The company’s advertising revenue is expected to more than double in the June quarter.
According to analysts’ estimates Total revenues are expected to increase 16.4% to $9.53 billion of dollars while profits, given the restriction on the number of people who can use the same subscription and also thanks to advertising growth, are expected to rise by 29% to 2.1 billion. Netflix’s original shows, such as the love story “Bridgerton” and the series “Baby Reindeer,” based on the experience of the comedian Richard Gadd with a stalker, topped the charts of the most watched in the second quarter, according to Nielsen data. In May, the company had announced that its ad-supported plan had reached 40 million monthly active users worldwide and accounted for 40% of all subscriptions in the countries where it was available, up from 23 million in January, a fact that led to a good increase in the stock market. However, it is known that during the summer months, viewership of Netflix and its rivals, such as Disney+, is reduced due to holidays. This year, there are also the Olympic Games during the summer, which certainly do not encourage watching films and TV series in streaming.
Netflix has announced that starting in 2025, it will no longer report the number of its subscribers, which has reached the remarkable number of 270 million. Netflix has gained a leading position in streaming thanks to its ability to produce new titles. There is now great anticipation for the second season of the Korean series Squid Game and for the arrival on the platform of one of the most followed sporting events in the US, namely the NFL football games. Analysts do not rule out a price list adjustment already made by its closest competitors in the US such as Comcast and Paramount+.
However, the results, if confirmed, would be in line with current consensus estimates that indicate a 14.8% increase in revenues for the full year 2024 (to 38.7 billion dollars), with profits expected to grow by double digits (+29%) reaching 8 billion dollars.
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