Netflix Q3 Earnings Preview: Growth Expected, Challenges Remain

Netflix (NASDAQ:NFLX) will report its third-quarter earnings today, with analysts forecasting solid growth in revenue, profit, and subscriber numbers.

The streaming giant has seen its shares rise by nearly 45% since the beginning of the year, although stock performance dipped after earlier earnings reports in April and July.

Analyst Expectations for Q3 2024:

Netflix is anticipated to end the quarter with just under 286 million active subscribers, an increase of 4 million from the previous quarter and over 30 million from the same period last year. The company plans to stop reporting subscriber data starting in 2025, shifting its focus to financial metrics.

A key driver of new subscriptions has been Netflix’s crackdown on password sharing, which analysts say has proven effective. However, Barclays recently downgraded the stock to “underweight,” citing concerns over growth strategies, despite maintaining a $550 price target.

Looking ahead, Netflix has high hopes for the holiday season. The company will broadcast its first NFL games on Christmas Day, which analysts see as a potential subscriber growth catalyst. According to a KeyBanc survey, nearly 25% of non-subscribers said these games might encourage them to sign up. KeyBanc analysts raised their price target to $760, reflecting optimism about this new venture.

Netflix is also expanding into live sports, becoming the official broadcaster for WWE events starting next year, which may further enhance its subscriber base.