The streaming giant Netflix is going to have a big day on Thursday when it releases its fourth quarter earnings report at the end of the day’s trading. It’s widely expected to reveal its strongest subscriber growth and a raft of new products including a step into the gaming industry. But will it be enough to help the Netflix stock price that is still 25% off its peak value?
It feels like a long time since Netflix shares traded for the all-time high of just over $700 in the middle of November, and the streaming company’s stocks currently sit at a five-month low. So far 2022 has been a difficult year for investors in Netflix, but hopes are that the quarterly report could help the brand’s stock price rebound.
The report is expected to announce that 8.4 million new subscribers were added in the fourth quarter. While this is a fraction below the guide figure issued by Netflix, it would still give the streaming brand a not inconsiderable 222 million customers. All of which would show that Netflix had enjoyed its best quarter so far.
Overall, Netflix is expected to show that it added over 18 million new subscribers in 2021. This is a pale shadow of the 36.6 million who flocked to join Netflix when the pandemic first struck in 2020.
As such, the question remains of whether Netflix can sustain this impressive growth in new customers throughout 2022. It’s widely believed that Netflix will only add just over six million new customers in the first quarter of the year – a traditionally slow time for subscriber take-up. However, this would be expected to improve to give Netflix an estimated 24 million new customers for the whole of 2022.
Obviously all of the rises and falls in the rate of new subscribers must be viewed against the backdrop of the pandemic. With new subscriber figures proving to be erratic and unpredictable amid a wave of lockdowns, it’s hoped that the relative calm could give Netflix the stability to roll out some of its more exciting new features in the coming months.
The streaming giant has significantly upgraded its content in the past few months after the pandemic largely halted production during 2020. With headline-grabbing new movies like Don’t Look Up, Netflix has shown that it can easily compete against major studios in terms of providing quality content that caters to a growing demand.
Delivering content that can rejuvenate the subscriber base is key to Netflix’s fortunes. Like many tech brands, the emphasis isn’t on short-term profits, rather than capturing and consolidating the new market territories. But it’s the arrival of new features such as the Netflix gaming platform that could prove most interesting. While this is still in its infancy, the arrival of a handful of mobile titles is showing that Netflix is unafraid to enter competitive new sectors.
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