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Are consumers gravitating towards Netflix‘s new ad-supported service? Shareholders are hoping the streamer sheds light on the new plan during its fourth-quarter earnings report, which is due after the bell Thursday.
Wall Street has kept a close eye on Netflix in recent quarters as it broke with its own tradition to offer up a lower-priced tier with advertisements and teased new strategies for cracking down on password sharing, all in an effort to boost revenue.
Here’s what Wall Street expects:
- EPS: 45 cents per share, according to Refinitiv.
- Revenue: $7.85 billion, according to Refinitiv survey.
- Expected global paid net subscribers: Addition of 4.57 million subscribers, according to StreetAccount estimates.
Last quarter, the streamer said it was “very optimistic” about its new advertising business. While it doesn’t expect the new tier will add a material contribution to its fourth-quarter results, it foresees membership growing gradually over time.
Heading into Thursday’s report, analysts are expecting the company to announce an additional 4.57 million paid subscribers, on pace with Netflix’s own projection of 4.5 million. The number would be stronger than the 2.4 million the service added in the previous quarter and significantly better than the declines it saw in the first half of the year.
Going forward, Netflix will no longer give subscriber guidance, although it will still report those numbers in future earnings reports. The rationale is that the company is growing its focus on revenue as its primary top line metric instead of membership growth.
Source:CNBC
