Streaming giant Netflix Inc (NASDAQ:NFLX) no longer reports subscriber figures with its quarterly results, which could make management commentary on past and future content even more important in reading between the lines of how the company is keeping its current subscribers and trying to add more.
00:00So Netflix, really, really strong day yesterday.
00:03Opened around 1,200, peaked at about 1,247, closed at about 1,239.
00:08We're actually trading up towards yesterday's intraday high here in the pre-market.
00:12Remember, they have earnings tonight.
00:15Let me go back to, oh, you know what?
00:16Let me go to the daily chart here just to kind of give you an idea of where we're sitting.
00:20I know we were talking before when we were waiting for this.
00:23We really wanted Netflix to pull back to the 200-day.
00:26We got a pullback towards the 200-day, but never really quite got there.
00:30Now it actually looks like it's recaptured a lot of these, kind of in the sideways move here.
00:35Let's see what the options are predicting here for Netflix.
00:39Market makers are predicting a $80 move.
00:43$80 move here for Netflix, currently sitting at 1,238.
00:47I mean, this thing could easily make a run at all-time highs if it does end up trading higher here on the back of that earnings report.
00:54Let's dive into what's expected here.
00:57Streaming giant Netflix no longer reports subscriber figures with its quarterly result,
01:02which could make management commentary on past and future content even more important
01:08in reading between the lines of how the company is keeping its current subscribers and trying to add more.
01:14The company reports third-quarter financial results on Tuesday after the market closes.
01:18Here are some of those estimates.
01:20Analysts expect Netflix to report third-quarter revenue of $11.51 billion.
01:25That would be up from $9.82 billion last year's third quarter.
01:29The company has beaten analyst estimates for revenue in eight straight quarters.
01:34So pretty good winning streak here.
01:36If that turns around, I think that could actually kind of be bad.
01:39We'll see how the market behaves here today.
01:42But eight straight quarters in a row of beating those estimates.
01:44Analysts expect Netflix to report third-quarter earnings per share of $6.97, up from $5.40 in last year's third quarter.
01:52The company has beaten analyst estimates for earnings per share in six straight quarters and nine of the past 10 quarters overall.
01:59So revenue in eight straight, EPS in six straight, but also nine of the last 10.
02:03Pretty good track record here.
02:05I think if they miss, that actually sets up for a pretty good down move.
02:08I don't know if that's the case.
02:09Honestly, I really don't think, I suspect, gun to my head, I suspect Netflix is going to beat here today and trade higher.
02:17That's just kind of where I'm at right now.
02:19A strong content lineup that included K-pop demon hunters.
02:24Got to say, I have no familiarity with this, so I'm going to have to lean on the group to tell me if this is any good.
02:30A current lineup that included K-pop demon hunters and several live sporting events could help the company match guidance.
02:36Bank of America securities analyst Jessica Reif Elric said in a recent investor note.
02:42The analyst reiterated a buy rating in a $14.90 price target ahead of the quarterly results.
02:48Elric sees subscriber momentum in the quarter coming from ad-supported plans and live events.
02:55Elric also highlighted Netflix integration with Amazon in the fourth quarter, which will expand ad buying options.
03:01The analyst said that the integration could improve Netflix's ad demand.
03:06Now, I think what this means, I obviously use Prime for a number of things that I watch.
03:13I also use YouTube on Sundays to watch the Sunday ticket.
03:19And I've noticed that whenever I use those apps, there are ads like the commercial that plays.
03:25There's a button, you just press the OK button on your remote and it immediately takes you to the checkout for that.
03:31I wonder if they're going to kind of fold some of this in.
03:34And I guess my question for the group here, has any of you, have any of you folks actually bought a product from an ad that you were given on Prime, Netflix or otherwise?
03:44I see those. I know they're trying to make it easier to buy.
03:50I get it. It just hasn't worked for me.
03:52I kind of think I might be in the minority there.
03:54So I'd be curious if anyone has actually seen a commercial, been like, oh, I need product.
04:00Let me buy it real quick and carried that through.
04:03Kenneth says no way.
04:05Yeah, that's kind of the way I feel.
04:06Cam says nope.
04:08With you on that, to me, I don't I know that they're kind of forecasting some of this.
04:13It's just I don't have any way to really compare that myself.
04:16I'm not moved by these ads, if you will.
04:21Netflix is let's see.
04:23Here are some other analyst ratings and price targets.
04:26Seaport Global went from neutral to buy in a 1385 target.
04:31Citigroup has a neutral rating, but raised the price target to 1295 from 1280.
04:36Loop Capital upgraded from hold to buy and the price target went from 1150 to 1350.
04:41Netflix's third quarter content slate includes the highly successful K-pop Demon Hunters movie,
04:47a second season of Wednesday, several live events, and the third season of Squid Game,
04:52which came out only a couple of days left in the quarter.
04:55K-pop Demon Hunters is an animated kids movie.
04:57It's the streamer's most popular movie of all time by viewers, man, and was a surprise smash hit in the quarter.
05:05The firm had 325.1 million views and ranked in the top 10 Netflix English language films for 17 weeks.
05:16I definitely seem to be the boomer there.
05:18I've never even heard of this.
05:20Along with high viewership, the movie saw a short theatrical run for a sing-along version.
05:24That's been a strong consumer product staple and has songs that topped Billboard's charts
05:31and will likely see some more of the most popular Halloween costumes for kids this year.
05:36The film debuted on Netflix on June 20th, which was in the second quarter,
05:39but the majority of the film's success will be in the third quarter.
05:43It has been some time since the streaming giant has had this much fanfare around it,
05:49dating back to the early days of the first season of Squid Game on Netflix.
05:52I remember that Netflix actually was a great trade around that first Squid Game season.
05:56While Netflix had a strong lineup content in the third quarter,
05:59investors and analysts will want to hear more about the fourth quarter lineup
06:02and what the company's expectations are for revenue and subscriber growth.
06:07Remember, the big thing for me, Netflix has multiple NFL games coming up in this fourth quarter here.
06:13To me, that's the one thing in the history of the company that has moved me to buy the streaming service.
06:19It did it last year, and it's going to do it again.
06:22Full stop.
06:22So I think that there's actually going to be some pretty good stuff coming up in this quarter,
06:27which is also one of the reasons why I'm interested in it for this particular earnings season.
06:31The company has a fifth and final season of Stranger Things coming in the fourth quarter
06:35and will also release two NFL games on Christmas Day.
06:39These items could be among the most viewed Netflix programs of all of 2025,
06:44and both of them come in the fourth quarter.
06:46While Netflix doesn't break out subscriber growth figures or estimates,
06:51revenue growth in regions and overall, along with the updates of the overall health,
06:55could signal higher membership figures.
06:57The company highlighted more members, higher pricing, and higher advertising revenue
07:01as the season's second quarter revenue and operating margins were higher year over year.
07:07A Netflix ad-supported plan is another big area where analysts will be focused,
07:11as this is one of the key growth catalysts for the company as subscriber growth matures.
07:16The company looks to boost revenue per subscriber.
07:20Their earnings report from Netflix comes as the streaming giant faces pressure from billionaire
07:24Elon Musk and the Pentagon over content deemed woke.
07:29Musk calls for his followers to cancel Netflix, but that came well into the fourth quarter.
07:33Whether the company's comments on subscriber strength or if it's seeing any high cancellation figures
07:39remains to be seen.
07:40So I don't have any info or line on that.
07:44Personally, I wouldn't trade it based on that catalyst alone, but that's just me.
07:48I'm more interested in what kind of forecasts they have for those NFL games.
07:54Again, last year they went off without a hitch.
07:57This was after the Jake Paul fight, which was marred with a whole bunch of streaming problems.
08:01They had it all solved for last year.
08:03I would imagine the same is going to be true this year.
08:05And I suppose I look forward to buying another month of Netflix so I can watch my NFL games.
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