Netflix with a sharp increase in new subscribers 💡

Shares of Netflix (NFLX.US) are losing 0.5% before the opening of the Wall Street session, following the release of its Q2 2024 results. Although the results themselves turned out to be very good, with the company beating expectations in terms of the number of new subscribers, earnings per share and revenue, so forecasts for Q3 turned out to be slightly lower. 

Q2 RESULTS 

• Net change in paid streaming subscriptions +8.05 million, +37% y/y, estimate +4.87 million
• Revenue $9.56 billion, +17% y/y, estimate $9.53 billion 
• Total paid streaming subscriptions 277.65 million, +16% y/y, estimate 273.78 million 
• EPS $4.88 vs. $3.29 y/y, $4.74 estimate 
• Operating margin 27.2% vs. 22.3% y/y, 26.5% estimate 
• Operating income $2.60 billion, +42% y/y, $2.54 billion estimate 
• Free cash flow $1.21 billion, -9.4% y/y, $1.61 billion estimate

THIRD QUARTER FORECAST 

• Anticipates revenue $9.73 billion, estimate $9.83 billion 
• Anticipates EPS $5.10, estimate $4.74 
• Anticipates operating margin 28.1%, estimate 25.7%

FORECAST FOR THE YEAR 

• Expects operating margin of 26%, previously 25%, estimate 25% 
• Still anticipates free cash flow of about $6 billion, $6.59 billion estimate
• Company anticipates annual revenue growth of 14%-15%, previously 13%-15% 

OTHER IMPORTANT COMMENTS

Advertising revenue is growing satisfactorily and becoming a more significant contributor to the business, but does not see advertising as a major driver of revenue growth in 2024 or 2025 

The company's shares lost nearly 0.5% before Wall Street opened. Source: xStation 5