Netflix's second quarter 2024 earnings preview: the fight to stay on top
Q2 Netflix earnings preview and share price analysis.
Netflix's second quarter 2024 earnings preview: the fight to stay on top
As Netflix gets ready to announce its earnings for the second quarter (Q2) of 2024, investors want to know if the popular streaming service can keep attracting lots of new subscribers, make the most of its ad-supported plans, and remain the top streaming platform.
When will Netflix share its latest earnings information?
Netflix will reveal its April through June 2024 financial results after the stock market closes on Thursday, 18 July 2024.
Another Netflix revenue increase seems to be on the cards
Netflix expects its revenue to increase 16% year-over-year (YoY) to $9.49 billion in the second quarter of 2024 but analysts predict Netflix's Q2 revenue will be slightly higher at $9.53 billion. In the first quarter of 2024, Netflix's revenue was $9.37 billion, up 15% from the prior year.
Earnings are also expected to rise
Regarding earnings, Netflix forecasts net income of $2.06 billion, or $4.68 per share, for the second quarter of 2024 whereas analysts estimate Netflix's Q2 earnings per share will reach $4.74. For comparison, in Q2 2023, Netflix reported net income of $1.48 billion, or $3.29 per share. Netflix's net income in quarter 1 (Q1) 2024 was $2.3 billion, or $5.28 per share.
Further revenue growth in the pipeline
YoY Netflix expects 21% FX-neutral revenue growth in Q2. Paid net additions are likely to be lower in Q2 than Q1 due to seasonal trends but global average revenue per membership is predicted to increase YoY in Q2 (on an FX-neutral basis).
In Q1 2024, Netflix added 9.3 million net subscribers, grew global paid memberships 16% YoY to 269.6 million, and increased average revenue per membership 1% YoY (or 4% on an FX-neutral basis). Engagement remained solid despite changes like paid sharing.
Netflix sales revenue chart
For Q2 2024, Netflix forecasts $2.52 billion in operating income and 26.6% operating margin, versus $1.82 billion and 22.3% in Q2 2023. This compares to Q1 2024 operating income of $2.63 billion and operating margin of 28.1%.
LSEG Data & Analytics analyst Netflix recommendations
LSEG Data & Analytics data shows a consensus analyst rating of ‘buy’ for Netflix – 11 strong buy, 18 buy, 16 hold and 1 sell (as of 10 July 2024).
Netflix – technical view
The Netflix share price, up over 45% year-to-date, is approaching its November 2021 record high at $700.99 which, since it was made near the major psychological $700 mark, probably won’t be easily overcome.
Netflix monthly chart
A rise above the $700.99 all-time high would allow for the $750 region to be in focus, though.
On the daily chart, the Netflix share price has been range bound since late June but last week did rise to its current July high at $697.49, close to the $700.99 record peak.
The upside is being supported by the May-to-July uptrend line at $678.42 below which good support can be spotted between the May high and the late June and early July lows at $633.78 to $662.30. While this area underpins, the short-term uptrend will remain valid.
Netflix daily chart
For a medium-term top to be formed, the Netflix share price would have to fall through its $626.44 June low. Slightly above this level the April high at $639.00 would be expected to offer support in such a scenario.
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