{"id":16290,"date":"2023-04-19T15:47:46","date_gmt":"2023-04-19T15:47:46","guid":{"rendered":"https:\/\/lynettelockhart.com\/client\/netflix-shares-slip-five\/"},"modified":"2023-04-19T15:51:36","modified_gmt":"2023-04-19T15:51:36","slug":"netflix-shares-slip-five","status":"publish","type":"post","link":"http:\/\/lynettelockhart.com\/client\/netflix-shares-slip-five\/","title":{"rendered":"Netflix shares slip; five charts that break down its earnings"},"content":{"rendered":"

By Nivedita Balu and Tiyashi Datta<\/p>\n

(Reuters) – Netflix Inc’s shares fell nearly 3% on Wednesday after the streaming pioneer forecast current-quarter revenue and profit below Wall Street estimates, hit by a delay in the wider roll-out of its solution to password sharing.<\/p>\n

The company will now launch paid sharing widely, including in the U.S., between April and June. It reported a rise in subscriber growth in the first quarter in Canada – one of the markets where it has cracked down on password sharing.<\/p>\n

The move is expected to result in some knee-jerk churn and near-term earnings risks but should ultimately pay off, analysts said.<\/p>\n

“The next few months will likely be noisy as paid sharing headline risk grows louder, but we’d be buyers of related pullbacks,” J.P.Morgan analyst Doug Anmuth said.<\/p>\n

Here are five charts that explain Netflix’s first quarter: <\/p>\n

AVERAGE REVENUE PER MEMBERSHIP <\/p>\n

\n

Average Revenue Per Membership, https:\/\/www.reuters.com\/graphics\/NETFLIX-CHART\/dwvkdjwlxpm\/chart.png<\/p>\n

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Cowen analyst Mark Mahaney said the average revenue generated per member on the $6.99 offering with ads was higher than that on the $15.49 subscription, suggesting Netflix had ramped up revenue generation through ads faster than expected.<\/p>\n

The challenge ahead is getting the sign-ups for Netflix’s ad offering, Mahaney noted.<\/p>\n

ADVERTISEMENT REVENUE<\/p>\n

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Netflix’s projected ad revenue Netflix’s projected ad revenue, https:\/\/www.reuters.com\/graphics\/NETFLIX-CHART\/znpnbjrmxpl\/chart.png<\/p>\n

\n

SUBSCRIPTION REVENUE BY REGION<\/p>\n

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Netflix’s subscription by region, https:\/\/www.reuters.com\/graphics\/NETFLIX-CHART\/myvmojernvr\/chart.png<\/p>\n

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UBS analyst John Hodulik said the Canada numbers gave “increased conviction” that wider password sharing restrictions could provide an over 5% bump to revenue and become “meaningfully accretive” as soon as the third quarter.<\/p>\n

SLIDING MARKET SHARE<\/p>\n

\n

Netflix subscriber additions in the past decade Netflix subscriber additions in the past decade, https:\/\/www.reuters.com\/graphics\/NETFLIX-SUBSCRIBERS\/jnpwereanpw\/chart.png<\/p>\n

\n

Netflix’s market share is shrinking as competition heats up.\u00a0The company had\u00a049.1% of total U.S. OTT subscription revenues in 2018, but will have just\u00a026.3% by the end of 2023, Insider Intelligence predicted.<\/p>\n

END OF THE DVD RENTING ERA <\/p>\n

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End of an era: Netflix winds down DVD rental business, https:\/\/www.reuters.com\/graphics\/NETFLIX-CHART\/myvmojezdvr\/chart.png<\/p>\n

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Netflix said it is winding down its DVD-by-mail business, ending the service it started around 25 years ago.<\/p>\n

\n

(Reporting by Nivedita Balu and Tiyashi Datta in Bengaluru)<\/p>\n

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By Nivedita Balu and Tiyashi Datta (Reuters) – Netflix Inc’s shares fell nearly 3% on Wednesday after the streaming pioneer forecast current-quarter revenue and profit below Wall Street estimates, hit by a delay in the wider roll-out of its solution to password sharing. The company will now launch paid sharing widely, including in the U.S., […]<\/p>\n","protected":false},"author":8,"featured_media":16291,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"spay_email":"","footnotes":""},"categories":[1213],"tags":[],"class_list":["post-16290","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-u-s-business"],"jetpack_featured_media_url":"http:\/\/lynettelockhart.com\/client\/wp-content\/uploads\/Reuters_Direct_Media\/USOnlineReportBusinessNews\/tagreuters.com2023binary_LYNXMPEJ3I0N7-VIEWIMAGE.jpg","_links":{"self":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/16290","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/comments?post=16290"}],"version-history":[{"count":1,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/16290\/revisions"}],"predecessor-version":[{"id":16292,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/16290\/revisions\/16292"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/media\/16291"}],"wp:attachment":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/media?parent=16290"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/categories?post=16290"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/tags?post=16290"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}