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Netflix expects its first-quarter earnings to be $2.82 per share, suggesting a year-over-year decline of 20%.
The Zacks Consensus Estimate for earnings is currently pegged at $2.81 per share, unchanged over the past 30 days. The figure indicates a 20.4% decline from the year-ago quarter.
Netflix expects total revenues to increase 4% year over year (8% on a forex-neutral basis) to $8.172 billion. The consensus mark for first-quarter revenues is currently pegged at $8.18 billion, suggesting 3.93% 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 surprise being 0.92%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
Netflix’s first-quarter 2023 results are expected to reflect the negative impact of paid sharing launch on user engagement. Its projection includes prospects of some cancellations similar to what it witnessed in Latin America. However, the company expects engagement levels to improve gradually, driven by strong content.
Moreover, ad-supported low-priced plans are expected to have a modest incremental benefit toward top-line growth in the to-be-reported quarter.
Stiff competition from streaming services like Disney’s (DIS - Free Report) Disney+, HBO Max, Comcast’s (CMCSA - Free Report) Peacock, Paramount+, Apple’s (AAPL - Free Report) Apple TV+, and Amazon has been a headwind for Netflix.
Nevertheless, Netflix’s strong content portfolio is expected to have helped keep the subscriber base intact in the first quarter of 2023.
Netflix’s sprawling games portfolio is also expected to have boosted user engagement in the to-be-reported quarter.
The company’s shares have gained 17.4% year to date, outperforming the Zacks Broadcast Radio and Television industry’s gain of 9.6%, benefiting from an impressive content portfolio. First-quarter 2023 launches included The Night Agent, Luther: The Fallen Sun, The Glory and more.
Top-Line Growth Estimates for Q1
The Zacks Consensus Estimate for paid total streaming net membership gain is pegged at 3.719 million. Netflix gained 7.66 million paid subscribers globally, higher than its estimate of 4.5 million users in the fourth quarter of 2022.
The consensus mark for first-quarter 2023 APAC revenues is pegged at $928 million, indicating 1.2% growth from the figure reported in the year-ago quarter.
Our estimate for Asia-Pacific is pegged at $923.2 million, indicating 0.7% year-over-year growth.
The Zacks Consensus Estimate for Latin America (LATAM) revenues is pegged at $1.06 billion, suggesting almost 5.8% growth from the figure reported in the previous quarter.
Our estimate for LATAM revenues is pegged at $1.05 billion, indicating 5.4% year-over-year growth.
Moreover, the consensus mark for Europe, Middle East & Africa revenues is pegged at $2.57 billion, suggesting 0.4% growth from the figure reported in the year-ago quarter.
Our estimate for Europe, Middle East & Africa revenues is pegged at $2.52 billion, suggesting a 1.7% year-over-year decline.
The Zacks Consensus Estimate for the United States and Canada revenues stands at $3.590 billion, indicating 7.2% growth from the figure reported in the year-ago quarter.
Our estimate for the United States and Canada revenues stands at $3.64 billion, indicating 8.7% year-over-year growth.
Image: Bigstock
Netflix (NFLX) Gears Up for Q1 Earnings: What's in the Cards?
Netflix (NFLX - Free Report) is set to report its first-quarter 2023 results on Apr 18.
Netflix expects its first-quarter earnings to be $2.82 per share, suggesting a year-over-year decline of 20%.
The Zacks Consensus Estimate for earnings is currently pegged at $2.81 per share, unchanged over the past 30 days. The figure indicates a 20.4% decline from the year-ago quarter.
Netflix expects total revenues to increase 4% year over year (8% on a forex-neutral basis) to $8.172 billion. The consensus mark for first-quarter revenues is currently pegged at $8.18 billion, suggesting 3.93% 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 surprise being 0.92%.
Netflix, Inc. Price and EPS Surprise
Netflix, Inc. price-eps-surprise | Netflix, Inc. Quote
Let’s see how things are shaping up for this announcement.
Factors to Consider
Netflix’s first-quarter 2023 results are expected to reflect the negative impact of paid sharing launch on user engagement. Its projection includes prospects of some cancellations similar to what it witnessed in Latin America. However, the company expects engagement levels to improve gradually, driven by strong content.
Moreover, ad-supported low-priced plans are expected to have a modest incremental benefit toward top-line growth in the to-be-reported quarter.
Stiff competition from streaming services like Disney’s (DIS - Free Report) Disney+, HBO Max, Comcast’s (CMCSA - Free Report) Peacock, Paramount+, Apple’s (AAPL - Free Report) Apple TV+, and Amazon has been a headwind for Netflix.
This Zacks Rank #3 (Hold) company is also facing competition for consumer time from linear TV, YouTube, short-form entertainment like TikTok, and gaming. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Nevertheless, Netflix’s strong content portfolio is expected to have helped keep the subscriber base intact in the first quarter of 2023.
Netflix’s sprawling games portfolio is also expected to have boosted user engagement in the to-be-reported quarter.
The company’s shares have gained 17.4% year to date, outperforming the Zacks Broadcast Radio and Television industry’s gain of 9.6%, benefiting from an impressive content portfolio. First-quarter 2023 launches included The Night Agent, Luther: The Fallen Sun, The Glory and more.
Top-Line Growth Estimates for Q1
The Zacks Consensus Estimate for paid total streaming net membership gain is pegged at 3.719 million. Netflix gained 7.66 million paid subscribers globally, higher than its estimate of 4.5 million users in the fourth quarter of 2022.
The consensus mark for first-quarter 2023 APAC revenues is pegged at $928 million, indicating 1.2% growth from the figure reported in the year-ago quarter.
Our estimate for Asia-Pacific is pegged at $923.2 million, indicating 0.7% year-over-year growth.
The Zacks Consensus Estimate for Latin America (LATAM) revenues is pegged at $1.06 billion, suggesting almost 5.8% growth from the figure reported in the previous quarter.
Our estimate for LATAM revenues is pegged at $1.05 billion, indicating 5.4% year-over-year growth.
Moreover, the consensus mark for Europe, Middle East & Africa revenues is pegged at $2.57 billion, suggesting 0.4% growth from the figure reported in the year-ago quarter.
Our estimate for Europe, Middle East & Africa revenues is pegged at $2.52 billion, suggesting a 1.7% year-over-year decline.
The Zacks Consensus Estimate for the United States and Canada revenues stands at $3.590 billion, indicating 7.2% growth from the figure reported in the year-ago quarter.
Our estimate for the United States and Canada revenues stands at $3.64 billion, indicating 8.7% year-over-year growth.
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