Netflix first quarter earnings preview: Subscriber growth in focus

Following a mixed bag of the US banking earnings outcomes, Netflix will take the spotlight as the initial major US tech company to report its first-quarter performance after the US market on 18 April. With Netflix shares showing a 28% increase year-to-date, outperforming the majority of prominent technology stocks in 2024, anticipation is high. As the world's largest video streaming platform, the number of subscribers remains a pivotal metric, offering insights into the company's growth trajectory.

In 2023, Netflix experienced a notable resurgence in growth following a significant slowdown in 2022. This turnaround is largely credited to the introduction of its ad-tier plan in November 2022. Additionally, the company's crackdown on password-sharing has also played a significant role in driving its subscriber growth. In the last quarter of 2023, the video-streaming service company added 13.1 million users, taking its total subscribers to a record 260.8 million, up by 12% from 2022. This surge in user growth has solidified Netflix's position as the market leader in the streaming service industry, followed by Disney+ and Amazon Prime.

Netflix has beaten the market estimates in revenue growth for two out of the past four quarters. In the final quarter of 2023, its revenue grew by 8.2% to $8.83 billion (€7.1 billion), with the net income increasing to $937.8 million (€753.6 million), translating to an earnings per share of $2.11 (€1.69), a substantial increase from $0.12 in the same quarter of 2022.

Netflix has forecasted an increase in earnings per share to $4.49 (€3.61) and a rise in revenue to $9.2 billion (€7.4 billion) for the first quarter of 2024. This represents a 56% and 13% increase, respectively, from the same period a