4/18/24, 2:53 PM
Netflix Earnings: Record Profits As Subscriber Growth Tops Estimates
FORBES
BUSINESS
BREAKING
Netflix Reports Record Profits
As Subscriber Growth Tops
Estimates
Derek Saul Forbes Staff
Follow
Derek Saul has covered financial markets for Forbes
since 2021.
0
Apr 18, 2024, 04:25pm EDT
Click to save this article.
Updated
Apr
18, 2024,
04:31pm
EDT
You'll be
asked
to sign
into your
Forbes
account.
Got it
TOPLINE Netflix reported blockbuster financial results in its first-
quarter earnings report Thursday afternoon, as the streaming king
returns to explosive subscriber growth, though some question how
long the fruits of its password sharing crackdown will last.
Netflix is fresh off of its best ever quarterly subscriber growth, topping even 2020's first ...
[+] GETTY IMAGES
https://www.forbes.com/sites/dereksaul/2024/04/18/netflix-reports-record-profits-as-subscriber-growth-tops-estimates/?sh=445c2cd7222b
Privacy - Terms
1/5
4/18/24, 2:53 PM
Netflix Earnings: Record Profits As Subscriber Growth Tops Estimates
KEY FACTS
• Netflix’s $9.4 billion in first-quarter revenues and $5.28 profit
per share were comfortably above consensus analyst estimates,
with Netflix’s top and bottom line marks both the best in its
history.
• Perhaps most impressively, Netflix’s 9.3 million of paid net
subscriber adds was about 70% above analyst forecasts, sending
its global subscriber base to a record 270 million.
• But Netflix expects the dough to come in slower next quarter, as
the $9.5 billion of sales it guided for was just below consensus
forecasts compiled by FactSet, and its $4.68 diluted earnings per
share for the second-quarter would mark a notable decline from
the just-completed quarter.
• Shares of Netflix fell about 3% immediately after the earnings
release, but remain up big for the year.
BIG NUMBER
2.53 million. That’s how many net U.S. and Canada subscribers
Netflix gained during the first quarter. That’s lower than the prior
quarter’s record 2.8 million adds, but shatter estimates of 1.1
million. Yet “there are increasingly fewer and fewer households in
[the U.S. and Canada] yet to subscribe to the streamer,” warned
MoffettNathanson analyst Michael Nathanson, noting the effects of
the password-sharing crackdown launched last year was a “pullforward of growth” that can’t be sustained “indefinitely.” Average
analyst forecasts put U.S. and Canada growth to come in at about
3.3 million in 2024, far below last year’s 5.2 million. We’re “now
https://www.forbes.com/sites/dereksaul/2024/04/18/netflix-reports-record-profits-as-subscriber-growth-tops-estimates/?sh=445c2cd7222b
2/5
4/18/24, 2:53 PM
Netflix Earnings: Record Profits As Subscriber Growth Tops Estimates
past the biggest impacts from paid sharing,” prognosticated
Rosenblatt analyst Barton Crockett.
CRUCIAL QUOTE
Netflix stock faced a “tricky setup” heading into earnings, noted
Deutsche Bank analyst Bryan Kraft., as the streamer’s share price is
up more than 75% over the last six months.
TANGENT
Valuation metrics suggest Netflix’s return to profitability growth is
heavily baked into its stock already, as its price-to-sales ratio
(market capitalization divided by trailing 12-month revenues) and
forward price-to-earnings ratio (share price divided by average
projected profits per share over next 12 months) are both hovering
at their highest levels since early 2022, sitting well above the
industry average. But Netflix is the “indisputable winner of the
streaming wars,” according to Nathanson, reflecting the strong
investor sentiment as market dominance is always an attractive
proposition.
Netflix Stock's Rapid Decline And Recovery
$700
Intraday all-time
high of $700.99
N
s
p
$
600
500
400
300
First quarter of
subscriber losses
since 2011
200
100
2020
2021
2022
2023
2024
KEY BACKGROUND
https://www.forbes.com/sites/dereksaul/2024/04/18/netflix-reports-record-profits-as-subscriber-growth-tops-estimates/?sh=445c2cd7222b
3/5
4/18/24, 2:53 PM
Netflix Earnings: Record Profits As Subscriber Growth Tops Estimates
The last few years have been a wild ride for Netflix investors. Shares
more than doubled from their early 2020 bottom to their
November 2021 all-time high of over $700, before cratering to as
low as $163 by mid-2022 as the market was aghast at the
company’s first quarterly subscriber losses since 2011. But it’s been
a steady uphill climb for Netflix over the past two years, with price
stabilization coming as the firm tallied its best ever year of
subscriber growth, revenue and profits in 2023, coinciding with the
company’s push to limit account sharing and launch of a cheaper
ad-supported tier.
FURTHER READING
MORE FROM FORBES
Netflix Announces First Major Venture Into Live Sports: $5 Billion
Deal For WWE's Raw
By Derek Saul
Forbes Daily: Join over 1 million Forbes Daily subscribers and get
our best stories, exclusive reporting and essential analysis of the
day’s news in your inbox every weekday.
Email address
Sign Up
By signing up, you agree to receive this newsletter, other updates about Forbes and its affiliates’
offerings, our Terms of Service (including resolving disputes on an individual basis via arbitration), and
you acknowledge our Privacy Statement. Forbes is protected by reCAPTCHA, and the Google Privacy
Policy and Terms of Service apply.
THE HOLLYWOOD REPORTER
Streaming Profit Report: A Year Spent Chasing Netflix
Follow me on Twitter or LinkedIn. Send me a secure tip.
Derek Saul
Follow
Derek Saul is a New Jersey-based Senior Reporter on our news desk. He
graduated in 2021 from Duke University, where he majored in Economics
and... Read More
https://www.forbes.com/sites/dereksaul/2024/04/18/netflix-reports-record-profits-as-subscriber-growth-tops-estimates/?sh=445c2cd7222b
4/5
4/18/24, 2:53 PM
Netflix Earnings: Record Profits As Subscriber Growth Tops Estimates
Editorial Standards
Reprints & Permissions
ADVERTISEMENT
Join Our Conversation
One Community. Many Voices. Create a free
account to share your thoughts. Read our
community guidelines here
Log in
Be the first to comment...
No one seems to have
shared their thoughts on
this topic yet
Leave a comment so your
voice will be heard first.
Powered by
Terms | Privacy | Feedback
https://www.forbes.com/sites/dereksaul/2024/04/18/netflix-reports-record-profits-as-subscriber-growth-tops-estimates/?sh=445c2cd7222b
5/5