Netflix’s report that the company lost 200,000 subscribers in the first quarter has put additional pressure on an already beleaguered tech sector, but lead tech analyst Mark Mahaney believes the sector’s current weakness presents several opportunities for investors.
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Netflix will report fiscal third quarter earnings on Tuesday after the call, with investors and shareholders focusing on subscriber numbers as fresh details emerge about the streamer’s upcoming ad format.
A new promotional level comes as Netflix tries to retain conscientious subscribers who have left the service or may end relationships in 2023. Last quarter, the streamer reported a smaller-than-expected loss of subscribers, but indicated that it only expects a return of one million during the third quarter.
Here’s what’s expected:
- earnings per share: According to Refinitiv, $2.13 per share.
- Income: According to a Refinitiv survey, $7.837 billion.
- Global Paid Network Subscribers: StreetAccount estimates 1.09 million subscribers added.
Last quarter, Netflix drew attention to a slowdown in revenue growth that it said was the result of competition, account sharing and other factors such as sluggish economic growth and the war in Ukraine.
“Now we have had more time to sort through these issues, as well as how best to solve them,” the company said in July.
It remains content-focused, offering big-budget movies on its service rather than in theaters, and bringing all episodes of new shows to subscribers at the same time. Although the company will make an exception for the long-awaited sequel to Rian Johnson’s Knives Out. Bow of Glass: The Riddle of Knives will have a limited run in theaters before its premiere via streaming.
In addition, investors will keep an eye out for updates to the Netflix paid sharing plan. This effort, which was mentioned earlier this year, will charge some members for sharing their subscription with family members or friends who live outside of their home. The company previously said it was looking at two different approaches in test cases in Latin America, which could provide clues to a wider rollout in 2023.
This is breaking news. Please stay tuned for updates.