Netflix Q4 To Show Advertising, Live Sports Strength, Analyst Says: 'Multiyear Narrative Of Compounded Growth'

Core Viewpoint - Netflix is expected to report strong fourth-quarter earnings, driven by live sports events, advertising strategies, and the return of popular shows like "Squid Game" [1][9]. Group 1: Analyst Insights - Goldman Sachs analyst Eric Sheridan maintains a Neutral rating on Netflix and raises the price target from $750 to$850 [1]. - Key themes identified include a competitive moat, a push into live sports, and advertising partnerships [2]. - The initial ventures into live sports are seen as the start of a multi-year growth narrative [3]. Group 2: Live Events and Advertising - Recent live events have stimulated user engagement and sign-ups, presenting an attractive advertising opportunity for Netflix [4]. - The Jake Paul vs. Mike Tyson boxing match resulted in approximately 1.4 million new sign-ups in the U.S. and had around 65 million concurrent streams globally [5]. - Netflix's ad-supported tier accounts for about 56% of gross additions and 43% of subscribers in the U.S. [5]. Group 3: Financial Expectations - Analysts anticipate fourth-quarter revenue of $10.13 billion, up from$8.83 billion in the same quarter last year [8]. - Expected earnings per share for the fourth quarter are $4.20, an increase from$2.11 in the previous year [9]. - Netflix has a history of exceeding revenue estimates in seven of the last ten quarters [8]. Group 4: Future Considerations - The upcoming quarter may face challenges due to a lower slate of original content [7]. - Commentary on live sports events and the second season of "Squid Game" will be closely monitored by investors [9].