Netflix Beats Estimates With Best Start to Year Since 2020

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Bloomberg Apr 19 03:33 · 18.1k Views

Netflix added 9.33 million customers in the first quarter of 2024, nearly doubling the 4.84 million average of analysts' estimates. Lucas Shaw reports.

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Transcript

  • 00:00 You heard Scarlet go through some of the numbers.
  • 00:02 On the surface,
  • 00:03 I would think that's looking pretty good here.
  • 00:04 But you see the share reaction square, the circle for us.
  • 00:08 Now look,
  • 00:09 I'll be honest, your guess on this one is a little bit as good as mine.
  • 00:12 The numbers look great across the board.
  • 00:14 The the two things I'd flag are one, expectations for this company were really high.
  • 00:18 I mean you saw a lot of analysts publishing optimistic notes leading up to it.
  • 00:22 The stock has been on a tear over the last few months
  • 00:25 and so I think there's almost no way that it was going to live up to that.
  • 00:28 You know, you see the results it, it basically doubled the the subscriber estimates.
  • 00:31 That's pretty strong.
  • 00:33 So I'd say one is just expectations and the other is maybe that there was some sensitivity around the forecast.
  • 00:38 You know the revenue forecast is actually pretty strong.
  • 00:40 It's going to grow faster than it did in the first quarter,
  • 00:43 but it said its subscriber growth would tick down a bit in the second quarter.
  • 00:47 That's normally what happens.
  • 00:49 But because of the lack of clarity on that number, you might see people being a little bit nervous around what that number is going to be going forward.
  • 00:55 So Lucas, when it comes to Netflix, it's driven by a couple of things.
  • 00:58 Certainly the password sharing crackdown that's yielded a lot of new subscribers and this ad supported subscription tier which is
  • 01:04 lower price than the the, the
  • 01:07 premium one or the, you know, the one that used to be the default.
  • 01:09 There's also this idea that it has must see content from where you sit and I know that
  • 01:15 the second quarter tends to be seasonally less strong than the first quarter.
  • 01:18 What is it about the programming that's really locking people back in?
  • 01:21 Is it the movies that they're paying for that they're paying up for or is it the
  • 01:25 the TV series that they're buying from, say HBO Max or
  • 01:29 other other
  • 01:30 production Helms?
  • 01:32 I mean I'd say it's their original TV series for the most part.
  • 01:35 You know, you look at the first quarter, at least one of the reasons they were able to add so much.
  • 01:39 They had a big new hit like
  • 01:41 every couple weeks from the start of the year.
  • 01:43 They had Berlin, which actually debuted at the end of 23, but is a big Spanish language, original spin off from money Heist, also known as Casa de Papel.
  • 01:51 You know, they had Griselda with Sofia Vergara, they had The Last Airbender.
  • 01:55 They just had a really steady diet of popular shows across a lot of different genres and from a lot of different countries.
  • 02:01 And that's really the hallmark.
  • 02:02 It's sometimes hard to know with Netflix how much of those that popularity is because it has a captive audience.
  • 02:08 It has that base and how much is because the shows are good.
  • 02:11 But whatever it is that that alchemy is working right now.