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Netflix expects its first-quarter earnings to be $4.49 per share, up 55.9% year over year or 12% on a foreign-exchange neutral basis.
The Zacks Consensus Estimate for earnings is currently pegged at $4.49 per share, which has remained unchanged over the past 30 days.
NFLX expects total revenues to increase 13.2% year over year to $9.24 billion. The consensus mark for first-quarter revenues is currently pegged at $9.26 billion, suggesting 13.43% growth from the figure reported in the year-ago quarter.
The company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, missing in the remaining one, the average negative surprise being 5.43%.
Let’s see how things are shaping up for this announcement.
For the first quarter of 2024, Netflix expects paid net sub additions to be down sequentially (reflecting seasonality as well as possible pull forward from the strong fourth-quarter 2023 results) but up year over year by 1.8 million.
NFLX expects global ARM to be up year over year on a F/X neutral basis in the first quarter.
Ad-supported low-priced plans are expected to have a fair incremental benefit toward top-line growth in the to-be-reported quarter. On Jan 10, Netflix’s president of advertising, Amy Reinhard, revealed that the advertising-based plan of the streaming service has surpassed 23 million global monthly active users at the Variety Entertainment Summit at CES 2024.
The company’s sprawling games portfolio is also expected to have boosted user engagement in the to-be-reported quarter. In the fourth quarter, the company started offering the highly popular video game trilogy, Grand Theft Auto: The Trilogy – The Definitive Edition by Take-Two Interactive (TTWO - Free Report) , to strengthen its position in the gaming industry. The trilogy is accessible to NFLX’s subscribers on the App Store, Google Play and within the Netflix mobile app.
The addition of Grand Theft Auto: The Trilogy is expected to have boosted Netflix's subscriber base and offerings in the to-be-reported quarter.
This Zacks Rank #3 (Hold) company is likely to have benefited from its diversified content portfolio, which is attributable to heavy investments in the production and distribution of localized and foreign-language content. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
However, stiff competition from streaming services like Disney’s (DIS - Free Report) Disney+, HBO Max, Peacock, Paramount+, Apple’s (AAPL - Free Report) Apple TV+ and Amazon has been a headwind for Netflix. It is also facing competition for consumer time from linear TV, YouTube, short-form entertainment like TikTok and gaming.
Shares of the company have gained 27.9% in the year-to-date period compared with the Zacks Consumer Discretionary sector’s and Disney’s return of 10.4% and 26.3%, respectively. Shares of Apple have lost 8.3% in the same period.
Top-Line Growth Estimates for Q1
The Zacks Consensus Estimate for paid total streaming net membership additions is pegged at 5.25 million.
The consensus mark for first-quarter 2024 Asia-Pacific revenues is pegged at $1.05 billion, indicating 12.6% growth from the figure reported in the year-ago quarter.
The Zacks Consensus Estimate for Latin America revenues is pegged at $1.12 billion, suggesting a rise of 5.5% from the figure reported in the previous quarter.
Moreover, the consensus mark for EMEA revenues is pegged at $2.97 billion, suggesting an increase of 18.3% from the figure reported in the year-ago quarter.
The Zacks Consensus Estimate for the United States and Canada revenues is pegged at $4.09 billion, indicating a 13.6% rise from the figure reported in the year-ago quarter.
Upcoming Earnings
Disney and Apple are set to report second-quarter fiscal 2024 results on May 7 and May 2, respectively.
Image: Bigstock
Netflix (NFLX) Gears Up for Q1 Earnings: What's in the Cards?
Netflix (NFLX - Free Report) is set to report first-quarter 2024 results on Apr 18.
Netflix expects its first-quarter earnings to be $4.49 per share, up 55.9% year over year or 12% on a foreign-exchange neutral basis.
The Zacks Consensus Estimate for earnings is currently pegged at $4.49 per share, which has remained unchanged over the past 30 days.
NFLX expects total revenues to increase 13.2% year over year to $9.24 billion. The consensus mark for first-quarter revenues is currently pegged at $9.26 billion, suggesting 13.43% growth from the figure reported in the year-ago quarter.
The company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, missing in the remaining one, the average negative surprise being 5.43%.
Let’s see how things are shaping up for this announcement.
Netflix, Inc. Price and EPS Surprise
Netflix, Inc. price-eps-surprise | Netflix, Inc. Quote
Factors to Consider
For the first quarter of 2024, Netflix expects paid net sub additions to be down sequentially (reflecting seasonality as well as possible pull forward from the strong fourth-quarter 2023 results) but up year over year by 1.8 million.
NFLX expects global ARM to be up year over year on a F/X neutral basis in the first quarter.
Ad-supported low-priced plans are expected to have a fair incremental benefit toward top-line growth in the to-be-reported quarter. On Jan 10, Netflix’s president of advertising, Amy Reinhard, revealed that the advertising-based plan of the streaming service has surpassed 23 million global monthly active users at the Variety Entertainment Summit at CES 2024.
The company’s sprawling games portfolio is also expected to have boosted user engagement in the to-be-reported quarter. In the fourth quarter, the company started offering the highly popular video game trilogy, Grand Theft Auto: The Trilogy – The Definitive Edition by Take-Two Interactive (TTWO - Free Report) , to strengthen its position in the gaming industry. The trilogy is accessible to NFLX’s subscribers on the App Store, Google Play and within the Netflix mobile app.
The addition of Grand Theft Auto: The Trilogy is expected to have boosted Netflix's subscriber base and offerings in the to-be-reported quarter.
This Zacks Rank #3 (Hold) company is likely to have benefited from its diversified content portfolio, which is attributable to heavy investments in the production and distribution of localized and foreign-language content. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
However, stiff competition from streaming services like Disney’s (DIS - Free Report) Disney+, HBO Max, Peacock, Paramount+, Apple’s (AAPL - Free Report) Apple TV+ and Amazon has been a headwind for Netflix. It is also facing competition for consumer time from linear TV, YouTube, short-form entertainment like TikTok and gaming.
Shares of the company have gained 27.9% in the year-to-date period compared with the Zacks Consumer Discretionary sector’s and Disney’s return of 10.4% and 26.3%, respectively. Shares of Apple have lost 8.3% in the same period.
Top-Line Growth Estimates for Q1
The Zacks Consensus Estimate for paid total streaming net membership additions is pegged at 5.25 million.
The consensus mark for first-quarter 2024 Asia-Pacific revenues is pegged at $1.05 billion, indicating 12.6% growth from the figure reported in the year-ago quarter.
The Zacks Consensus Estimate for Latin America revenues is pegged at $1.12 billion, suggesting a rise of 5.5% from the figure reported in the previous quarter.
Moreover, the consensus mark for EMEA revenues is pegged at $2.97 billion, suggesting an increase of 18.3% from the figure reported in the year-ago quarter.
The Zacks Consensus Estimate for the United States and Canada revenues is pegged at $4.09 billion, indicating a 13.6% rise from the figure reported in the year-ago quarter.
Upcoming Earnings
Disney and Apple are set to report second-quarter fiscal 2024 results on May 7 and May 2, respectively.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.