Netflix dips ahead of earnings, growth outlook in focus
NFLX•Netflix shares fell 0.8% to $69.28 ahead of quarterly results due after the bell. Analysts expect third-quarter revenue to rise about 12% year over year to $12.87 billion and adjusted earnings per share of $0.82, versus $0.59 a year earlier.
1. Results in focus
Investors are watching Netflix’s growth outlook and content strategy under new leadership. In July, the company’s third-quarter forecast disappointed Wall Street, and Netflix said it would reduce disclosures of viewing hours.
2. Leadership and estimates
The results follow the appointment of former Disney executive Peter Rice as content chief and layoffs affecting about 6% of Netflix’s workforce. Netflix faces competition for viewers from legacy rivals and free platforms including YouTube and TikTok.
3. Shares and analyst views
Netflix shares were down about 26% year to date, while the Nasdaq was up about 14%. The stock recently traded at a forward price-to-earnings ratio of 19, below its five-year average of 31; 37 of 51 analysts rated it buy or strong buy, 12 rated it hold and two rated it sell. The median price target was $90, down from $95 a month earlier and $100 on July 20.
