Eva Mathews

(Reuters] – Investors are betting on Netflix Inc. (NASDAQ:)’s plan to find more international content in order to increase slowing subscriber growth.

The low-cost survival drama, which attracted 111 million viewers in only 27 days, has been Netflix’s largest original series launch. This is in line with its plans to increase its investments overseas.

Guggenheim analysts wrote in a client notice that “we continue to consider international expansion as the key driver of subscribers growth, especially in less-penetrated emerging markets.”

Due to the disruption in production caused by the coronavirus, streaming giant Spotify reported the slowest rate of subscribers additions for the first half 2013 than it had ever experienced.

However, “Squid Game,” which was launched towards the close of the third quarter became a global sensation. Analysts said that actual global subscription additions could surpass the estimates of 3.8 million, and also benefit the three following months.

THE CONTEXT

Netflix lost much of its market share after the pandemic, as more unique platforms became popular among stay-at home entertainment users.

Apple (NASDAQ : TV+) has, by Parrot Analytics’ estimation, increased its share of global streaming revenue by 75% thanks to Ted Lasso’s success.

In just two years, Disney+ has accumulated a strong base of over 116 million subscribers.

Meanwhile, AT&T-owned HBO Max raised its global subscribers forecast to between 70 million and 73 million by July, indicating the preference to stream content-on-demand is here to stay.

Here’s a graph of the global streaming market share

https://www.datawrapper.de/_/qwKJf/

The Crown, “Money Heist”, and “Lupin” are international programs that have gained cross-border popularity and many Emmy nominations. They also helped maintain overseas subscriber growth.

In a research note, MoffettNathanson analyst said that the streaming battles aren’t a fight to overtake Netflix in viewers’ homes but to gain a spot alongside the red giant.

Bloomberg News reported https://www.bloomberg.com/news/articles/2021-10-17/squid-game-season-2-series-worth-900-million-to-netflix-so-far?sref=y3YMCJ4e that “Squid Games” would add about $900 million to the company’s value, citing internal documents.

FUNDAMENTALS

* Analysts estimate Netflix’s third-quarter revenue to grow 16.14% to $7.48 billion when it reports results on Oct. 19

* Earnings per share is estimated at $2.56

* As of Friday’s close, its shares have gained about 16% so far this year

WALL ST. SENTIMENT

* Wall Street analysts are largely bullish, with 33 out of 45 rating the stock “buy” or higher, while eight have a “hold” rating and four rate it as a “sell” or lower.

* The median price target is $650 versus the current price of $629.84

Below is a picture of Netflix’s restrictions and signups.

https://www.datawrapper.de/_/yok5Y/

QUARTER REFINITIV, ACTUAL BEEAT, MET

IBES ESTIMATE ENDING (IN MISSED

FOR MILLIONS

SUBSCRIBER

ADJUSTMENTS

(IN MILLIONS!)

Jun. 30 2021 1.04 1.54 Beat

Mar. 31 2021 6.25 3.98 Missed

Dec. 31 2020 6.1 8.51 Beat

Sep. 30 2020 3.4 2.2 Missed

Jun. 30 2020 8.07 10.09 Beat

Mar. 31 2020 7.47 15.67 Beat

Dec. 31 2019 7.63 8.77 Beat

Sep. 30 2019 6.73 6.77 Beat