{"id":234754,"date":"2021-04-24T19:38:00","date_gmt":"2021-04-24T16:38:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/netflixs-underwhelming-subscriber-gains-spark-vigorous-debate-about-the-future\/"},"modified":"2021-04-24T19:38:00","modified_gmt":"2021-04-24T16:38:00","slug":"netflixs-underwhelming-subscriber-gains-spark-vigorous-debate-about-the-future","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/netflixs-underwhelming-subscriber-gains-spark-vigorous-debate-about-the-future\/","title":{"rendered":"#\n  Netflix\u2019s underwhelming subscriber gains spark \u2018vigorous debate\u2019 about the future"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_89 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6af0090e9276b\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6af0090e9276b\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/netflixs-underwhelming-subscriber-gains-spark-vigorous-debate-about-the-future\/#Some_analysts_say_Netflix_is_just_up_against_tough_comparisons_from_earlier_in_the_pandemic_while_another_raises_concerns_about_competitive_positioning\" >Some analysts say Netflix is just up against tough comparisons from earlier in the pandemic, while another raises concerns about competitive positioning<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/netflixs-underwhelming-subscriber-gains-spark-vigorous-debate-about-the-future\/#Emily_Bary\" >Emily Bary<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong>#<br \/>\n  Netflix\u2019s underwhelming subscriber gains spark \u2018vigorous debate\u2019 about the future<br \/>\n<\/strong>&#8221;<\/p>\n<h2 class=\"article__subhead\" itemprop=\"alternativeHeadline\"><span class=\"ez-toc-section\" id=\"Some_analysts_say_Netflix_is_just_up_against_tough_comparisons_from_earlier_in_the_pandemic_while_another_raises_concerns_about_competitive_positioning\"><\/span>\n  Some analysts say Netflix is just up against tough comparisons from earlier in the pandemic, while another raises concerns about competitive positioning<br \/>\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><\/p>\n<div class=\"column column--full article__content\">\n<div class=\"article__side\">\n<div class=\"container--sticky not-active\">\n<div class=\"cx--next\">\n              <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<div id=\"js-article__body\" class=\"article__body article-wrap at16-col16 barrons-article-wrap\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0000238292\">\n<div class=\"barrons-article-ad-wrapper\">\n<div data-track=\"barrons-article-ad-wrap\" class=\"barrons-article-ad sticky_item\">\n<div class=\"barrons-main-article-ad-target sticky_target body_ad\" aria-hidden=\"true\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>       Netflix Inc. was one of the biggest winners in the early days of the pandemic, as people sheltered in place and turned to streaming content, but subscriber momentum has slowed more than a year into the COVID-19 crisis. <\/p>\n<p> The company\u2019s story may be more complicated than simply a case of a COVID-19 high flyer coming back to earth as life returns to normal. Netflix\u2019s<br \/>\n        NFLX,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/202353025\/composite\" class=\"negative\">-0.63%<\/bg-quote><br \/>\n       latest results and outlook, which underwhelmed expectations, are sure to spark \u201cvigorous debate\u201d about how much of Netflix\u2019s slowing traction can be attributed to demand that was pulled forward in the early days of the pandemic, and how much might be the result of other factors, according to Bernstein analyst Todd Juenger. <\/p>\n<div class=\"paywall\">\n       Shares of Netflix<br \/>\n        NFLX,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/202353025\/composite\" class=\"negative\">-0.63%<\/bg-quote><br \/>\n       were off 6..8% in Wednesday midday trading, enough to make them the S&amp;P 500 index\u2019s<br \/>\n        SPX,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210599714\/realtime\" class=\"positive\">+1.09%<\/bg-quote><br \/>\n       biggest decliners.<\/p>\n<p>For his part, Juenger argues that Netflix\u2019s subscriber problems are \u201cmostly\u201d a problem of accelerated demand during the pandemic that could see the balance of subscriber additions shifted more toward last year.<\/p>\n<p>\u201cIf one believes the pace of \u2018normal\u2019 annual growth in this life-cycle phase is 25-30 million [net additions], and FY20 delivered 37 million (i.e. +8-9 million above \u2018normal\u2019), then perhaps FY21 should be expected to deliver roughly 8-9 million below \u2018normal.&#8217;\u201d Juenger conjured, while noting that this back-of-the-envelope math \u201ccomes close\u201d to his new base-case subscriber forecast, which calls for 21 million net additions this year with the bulk of that weighted toward the second half of 2021. <\/p>\n<p><strong>Opinion:\u00a0There is a new normal for Netflix, and that is not necessarily a bad thing<\/strong><\/p>\n<p>Thinking about the two-year period on the whole, Juenger wrote that 37 million net additions in 2020 along with an estimated 21 million net additions for 2021 would yield 58 million in total, \u201cnear the high end of \u2018normal.&#8217;\u201d<\/p>\n<p>He admitted that the pandemic\u2019s impact on the timing of subscriber additions may not be the only reason for the recent slowdown, pointing to comments from Netflix\u2019s management team about how the first half of the year is expected to be lighter from a content perspective given that the COVID-19 crisis disrupted production. <\/p>\n<p>While Juenger thinks Netflix\u2019s value proposition is more about the breadth of content than new blockbuster hits, he said that Netflix\u2019s gross additions \u201ccan undoubtedly be \u2018hit boosted.&#8217;\u201d At the same time, he \u201ccategorically reject[ed]\u201d the idea that Netflix\u2019s dis<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ointing subscriber growth and outlook signal that the streaming market, or the company itself, is nearing maturity. <\/p>\n<p> Juenger rates the stock at outperform but lowered his price target to $617 from $671. <\/p>\n<div id=\"cx-membership-tile\"><\/div>\n<p><strong>See also: Your streaming subscriptions reshaped Disney and turbocharged Netflix \u2014 now comes making more money off you<\/strong><\/p>\n<p>Stifel analyst Scott Devitt also attributed the recent trends to tough comparisons relative to earlier periods of pandemic-driven strength. <\/p>\n<p>\u201cWe have been waiting for Netflix to have the quarter in which the pull forward became evident and the 1Q:21 results served as that moment,\u201d Devitt wrote in a note to clients. He expects that it will take Netflix three to nine months to work through steep comparisons to the pandemic-fueled results, after which investors could see \u201ca multi-year period in which the stock can compound at a rate consistent with revenue growth or ~15% per annum, allowing for some multiple compression given rising operating margins.\u201d<\/p>\n<p>He upgraded the stock to buy from hold while boosting his price target to $560 from $550. <\/p>\n<p>Guggenheim\u2019s Michael Morris argued that a programming ramp in the second half of the year will be key to driving a reacceleration in membership trends after the latest numbers served to \u201cshake confidence.\u201d <\/p>\n<p>\u201cWe are confident in the industry-wide global streaming video growth opportunity but believe results and guidance will call ultimate long-term member levels and the cost to acquire and maintain members into question,\u201d he wrote. \u201cThis likely makes Netflix a \u2018show me\u2019 story at least until 2Q earnings.\u201d <\/p>\n<p>Morris has a buy rating on the stock but lowered his price target to $600 from $625. <\/p>\n<p>Needham\u2019s Laura Martin had a more downbeat take, writing that the company faces competitive issues that could impact its market share. <\/p>\n<p>\u201cIn our view, spending more money on entertainment content won\u2019t work against new streaming competitors who are innovating with price, bundling, genre diversity (ie, live sports and <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">news<\/a>), business models, etc.,\u201d she wrote, while reiterating an underperform rating. \u201cWe believe that hit entertainment content is necessary, but not sufficient, to compete in the streaming wars going forward.\u201d<\/p>\n<p>At least 14 analysts lowered their price targets on Netflix\u2019s stock after the latest results, according to FactSet, while one analyst increased their target. Of the 43 analysts tracked by FactSet who cover Netflix\u2019s stock, 32 have the equivalent of buy ratings, six have hold ratings, and five have sell ratings, with an average price target of $608.46.<\/p>\n<p>Netflix shares have declined 12.2% over the past three months though they\u2019re up 17.3% over a 12-month span. The S&amp;P 500 has risen 7.3% over three months and 51.6% over 12 months.   <\/p><\/div>\n<\/div><\/div>\n<p><\/p>\n<div class=\"byline article__byline\">\n<p>      <span>By<\/span><\/p>\n<div class=\"author  hasMenu\" data-scrim='{\"type\":\"author\",\"header\":\"Emily Bary\",\"subhead\":\"The Wall Street Journal\",\"list\":[]}' itemscope itemprop=\"author\" itemtype=\"http:\/\/schema.org\/Person\">\n<h4 itemprop=\"name\"><span class=\"ez-toc-section\" id=\"Emily_Bary\"><\/span><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/marketwatch.com\/author\/emily-bary?mod=MW_author_byline\">Emily Bary<\/a><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/p><\/div>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more News articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"http:\/\/www.marketwatch.com\/news\/story.asp?guid=%7B21005575-02D4-D4B5-4572-D3A2D43A0440%7D&#038;siteid=rss&#038;rss=1\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Netflix\u2019s underwhelming subscriber gains spark \u2018vigorous debate\u2019 about the future &#8221; Some analysts say Netflix is just up against tough comparisons from earlier in the pandemic, while another raises concerns about competitive positioning Netflix Inc. was one of the biggest winners in the early days of the pandemic, as people sheltered in place and&#8230;<\/p>\n","protected":false},"author":1,"featured_media":189809,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[],"class_list":["post-234754","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/234754","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=234754"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/234754\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/189809"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=234754"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=234754"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=234754"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}