Sports Boosts Q4 Results As Analysts Discuss Future Price Increases

Netflix ( NFLX ) is set to report its fourth-quarter earnings on Tuesday after the market closes. Analysts expect the streamer to deliver strong results after it finished the year with two back-to-back NFL games, a successful “Jake Paul vs. Mike Tyson” boxing match and the return of “Squid Game.”

Netflix stock has fallen since the start of the year after ending 2024 at record highs. The stock pullback comes as macroeconomic uncertainty has weighed on megacap Big Tech.

Here’s what Wall Street expects for the fourth quarter, according to Bloomberg consensus estimates:

• Income: $10.11 billion (Netflix’s guidance: $10.13 billion) vs. $8.83 billion in Q4 2023

• Earnings per stock: $4.18 (Netflix’s guidance: $4.23) vs. $2.11 in Q4 2023

• Net subscribers additions: 9.18 million versus 13.12 million in Q4 2023

“There are very high expectations for this quarter,” Geetha Ranganathan, senior analyst at Bloomberg Intelligence, told Yahoo Finance’s Morning Brief program. “But it’s really the perfect setup for Netflix.”

Ranganathan called the company’s solid content slate, describing it as “one of their strongest quarters ever,” as live sports programming dominated the platform.

The Jake Paul and Mike Tyson fight in particular attracted over 108 million global viewerswill be the most streamed sporting event of all time. For context, the 2024 Super Bowl, which was the most watched American telecast of all timeattracted 124 million US viewers.

Similar to the NFL games averaged about 30 million viewers. According to Netflix, it was the most watched Christmas Day game of all time in the US.

“It’s going to be really interesting to see how (sports) shapes the future of Netflix,” Ranganathan said, adding. recent debut of WWE Raw will drive further growth and retention.

“This is really the big shift we’re going to see this quarter,” she said. “It’s going to drive subscriber momentum for Netflix in a big way. We expect well over 10 million subscriber additions.”

This will be the last earnings report in Netflix’s history to reveal net subscriber numbers. The company announced last spring that it would stop reporting the metric at the beginning of this year.

Investors have recognized the company’s efforts over the past year, which, in addition to a strong content slate, have included several advertising successes. According to the latest update, Netflix’s ad tier, now two years old, has reached 70 million global monthly active users.

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