• Economy
  • Editor’s Pick
Money Rise Today – Investing and Stock News
  • Investing
  • Stock
Investing

Netflix reports strong Q2 earnings with 34% ad-tier membership growth, but stock falls

by July 18, 2024
written by July 18, 2024

Netflix Inc. (NASDAQ: NFLX) posted impressive second-quarter results that exceeded market expectations, but its stock is experiencing a dip in after-hours trading. 

The streaming giant’s robust financial performance was significantly buoyed by the success of its ad-supported tier memberships, highlighting its strategic shift in revenue generation.

In Q2, Netflix reported earnings of $4.88 per share on revenues of $9.55 billion, surpassing analyst predictions of $4.74 per share and $9.53 billion in revenue. 

The company’s strong quarterly performance was driven by the popularity of series and films like “Bridgerton,” “Queen of Tears,” “Hitman,” and “Under Paris.” 

The addition of 8.05 million new subscribers pushed the total to 277.65 million, exceeding the Street’s estimate of 274.4 million. 

Consequently, Netflix’s stock has surged approximately 35% since the beginning of 2024.

Ad-tier memberships and revenue growth

Netflix’s growth was not only attributed to its existing content but also to the substantial progress in its ad-supported tier. 

The company reported a 34% sequential increase in ad-tier memberships, reflecting a steady expansion of its advertising business. 

This growth is part of Netflix’s broader strategy to diversify its revenue streams, which includes introducing live sports to attract more advertising dollars.

In its quarterly report, Netflix outlined plans to develop an “in-house ad tech platform” to enhance its advertising capabilities. 

The platform is expected to be tested in Canada later this year and launched globally in 2025. 

Despite these advancements, Netflix’s stock faced pressure due to its cautious guidance for Q3, anticipating a decrease in paid net additions compared to the previous year.

Netflix Q2 earnings snapshot

For the second quarter, Netflix reported:

Revenue: $9.55 billion, a 16.8% increase year-over-year, exceeding the consensus estimate of $9.53 billion.

Earnings per Share (EPS): $4.88, up from $3.29 in the previous year, surpassing the anticipated $4.74.

Operating Margin: 27.2%, an improvement from 22.3% a year ago, with expectations to maintain around 26% in 2024.

Netflix’s management reiterated its commitment to expanding its entertainment offerings and improving user engagement to sustain revenue and profit growth. 

The company is pivoting from a high-growth, low-profit model to a more sustainable, high-profit strategy.

Is it a good time to buy Netflix stock on the dip?

As Netflix prepares to halt the disclosure of quarterly subscriber numbers and average revenue per user (ARPU) starting next year, analysts at Wedbush Securities view this move as indicative of the company’s shift in focus. 

Despite Netflix’s leading position in the streaming industry, this strategic pivot is still underway.

For investors, the recent dip in Netflix’s stock presents a potential buying opportunity. 

Wedbush Securities projects a price target of $725 for Netflix shares, reflecting a possible increase of over 10% from current levels. 

Morgan Stanley also adjusted its price target upward in anticipation of Netflix’s Q2 results, signaling confidence in the company’s long-term prospects.

Watch here: https://www.youtube.com/embed/QTWq9rVuqJ0?feature=oembed

The post Netflix reports strong Q2 earnings with 34% ad-tier membership growth, but stock falls appeared first on Invezz

0 comment
0
FacebookTwitterPinterestEmail

previous post
LATAM Airlines to relist on NYSE with potential valuation of $8.5 billion
next post
CrowdStrike stock could drop to $275 amid valuation concerns, analyst warns

related articles

Asian markets open: Nikkei, Hang Seng fall on...

June 12, 2025

Aluminum and steel tariffs spark rise in secondary...

June 12, 2025

Airbus sees aviation boom ahead, global fleet to...

June 12, 2025

US-China trade talks and Washington’s decade-long effort to...

June 12, 2025

Europe markets open: Stoxx 600 dips as UK...

June 12, 2025

UK GDP falls by 0.3% in April as...

June 12, 2025

Gordon Brothers buys Poundland; pledges £80 mn for...

June 12, 2025

Air India plane crash: London-bound flight with 242...

June 12, 2025

Air India plane crash live update: Indian President...

June 12, 2025

Copper remains supported for now even as China...

June 12, 2025
Enter Your Information Below To Receive Free Trading Ideas, Latest News, And Articles.


Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest News

  • Trump’s spending bill heads to Senate where Republicans plan strategic adjustments to key provisions

    June 9, 2025
  • Meta executives eligible for 200% salary bonus under new pay structure

    February 21, 2025
  • PlayDoge Game – Get The Latest News and much more

    September 17, 2024
  • Some Juul users are receiving thousands of dollars as part of a $300M class action settlement

    October 22, 2024
  • Senate panel navigates delicate compromises on Medicaid, taxes in latest chunk of Trump’s megabill

    June 16, 2025

Popular Posts

  • 1

    Secret Service admits leaning on ‘state and local partners’ after claim it ignored Trump team’s past requests

    July 21, 2024
  • 2

    Elon and Vivek should tackle US funding for this boondoogle organization and score a multimillion dollar win

    December 4, 2024
  • 3

    Forex Profit Calculator: Maximize Your Trading Potential

    July 10, 2024
  • 4

    Five more House Democrats call on Biden to drop out, third US senator

    July 19, 2024
  • 5

    Biden calls to ‘lower the temperature’ then bashes Trump in NAACP speech

    July 17, 2024

Categories

  • Economy (829)
  • Editor's Pick (4,979)
  • Investing (634)
  • Stock (805)

Latest Posts

  • Netanyahu’s meeting at White House up in the air as Biden recovers from COVID: report

    July 22, 2024
  • Morning Glory: Trump’s approval ratings have never been higher

    December 17, 2024
  • Mark Zuckerberg on the stand: ‘Crazy,’ ‘scary’ ideas led him to buy Instagram and WhatsApp

    April 16, 2025

Recent Posts

  • Trump says Biden admin ‘knows what is happening’ on drones

    December 16, 2024
  • Rosie O’Donnell flees US after Trump win, won’t return until it’s ’safe for all citizens to have equal rights’

    March 12, 2025
  • Ethereum is waiting for a breakthrough above the EMA 200

    September 11, 2024

Editor’s Pick

  • Meta executives eligible for 200% salary bonus under new pay structure

    February 21, 2025
  • Grassley, Johnson press DOJ IG to respond on whether ‘untasked’ undercover agents were present on Jan 6

    April 16, 2025
  • USAID workers send message to Trump on boxes while leaving office for last time

    February 22, 2025
  • About us
  • Contacts
  • Privacy Policy
  • Terms & Conditions

Disclaimer: moneyrisetoday.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2025 moneyrisetoday.com | All Rights Reserved

Money Rise Today – Investing and Stock News
  • Economy
  • Editor’s Pick
Money Rise Today – Investing and Stock News
  • Investing
  • Stock