Q1 earnings season..Netflix this week

What to expect for Q1 earnings season

Whist Q1 earnings season began last week with the Big Banks, the Big Tech (Magnificent Seven) and entertainment companies start this Thursday with Netflix. Things to look out for this reporting season.

Netflix

Subscriber growth. Currently sitting at 260 million paid subscribers. The market expects the subscriber growth trend to continue. My prediction - 267 million subs (approximately).

They have been in the digital-gaming space for two years. Will we start to see some return on investment in this space?

Advertising. (AVoD) provides advertising revenue and not only is this good for Netflix, it also good for the consumers as streaming platforms expenses can become a sticky point for household incomes particularly in high inflationary and high interest rate environments. Whilst streaming is still the best value entertainment option for consumers, households wanting to make cost savings may drop the number of streaming platforms they have or choose the less expensive advertising option. Good for both - Netflix and consumers.

Feature Film Strategy. Last week Netflix announced the re-structure of their film business under the leadership of Dan Lin. The film division will be split by genre with different executives overseeing each specific category. More genre based films is good for both the business and the consumer. I am looking forward to hearing more about this

Will we hear much about Sports and their International expansion?

Disney, AppleTV+ and Paramount

Disney

Hulu was recently absorbed by the Disney business and now sits within the Disney 'family'. Will they increase their drama slate with less Marvel TV shows? What is the Hulu strategy going forward?

Did the Eras Tour increase subscribers for Disney+?

More about Fortnite and EPIC games.

As Marvel laid off 15 employees, does that mean Disney will have a more robust film strategy for the market?

AppleTV+

The drama juggernaut continues its drive forward. The best drama in the market at the moment is on AppleTV+. Masters Of The Air, Manhunt, The New Look, Sugar, Constellation and Palm Royale giving consumers the kind of drama entertainment that is reminiscent of HBO days past.

Will their AvoD strategy be discussed?

Monarch: Legacy of Monsters - was renewed for Season 2. Seeing the growth opportunities that the MonsterVerse IP creates, each Titan (or Godzilla and Kong) could have their own TV show - plotting their own journey and with that does digi-gaming investment in the MonsterVerse grow to new levels?

IP Franchise Management will continue to be a key growth driver

Paramount

Skydance and Private Equity swarm like bees and the Hedge Fund, Barrington urging Paramount to scrap exclusive discussions with Skydance to allow other investors to enter the fray. Will this be discussed in their earnings report?

Whilst Paramount+ continues to be a solid and stalwart streaming platform with the FBI and NCIS franchises, their new offerings have been slim of late - in large due to the SAG/AFTRA strikes last year. I am looking to a more detailed update and overview of the Yellowstone universe (1923 and 1944).

Mayor of Kingstown will return in June 2024.

Wrap Up

An interesting earnings season ahead as private equity is increasingly active in the entertainment space. Does Disney+ hit profitability and what of Amazon Prime this earnings season.? Where does AI sit and as YouTube is the only real competitor to Netflix, what do their results/future strategies look like? IMAX is proving to be a player in the exhibition space - what is next for them?

We have a very exciting reporting season ahead of us! I will be reporting on each company here, so tune in for some very interesting developments.

Thank you for reading!

Susie