Source: ink drop.
  • Netflix (NASDAQ:NFLX) added 9.33 million subscribers in Q1 2024, almost double the consensus forecast of analysts polled by LSEG, in addition to beating forecasts for sales and earnings
  • The company posted US$9.3 billion in revenue and US$2.3 billion in net income for the quarter
  • Netflix is one of the world’s leading entertainment services with almost 270 million paid members in more than 190 countries
  • Netflix stock has added more than 80 per cent year-over-year, but only about 55 per cent over the past five years

Netflix (NASDAQ:NFLX) added 9.33 million subscribers in Q1 2024, almost double the consensus forecast of analysts polled by LSEG, in addition to beating forecasts for sales and earnings.

The bombshell of Netflix’s quarterly report was that, beginning in Q1 2025, it will no longer report paid quarterly memberships or average revenue per member, in an effort to encourage investors to analyze the business based on more traditional financial metrics like revenue and profit. The company will, however, continue to share major subscriber milestones as it crosses them.

The company grew revenue by 67 per cent from US$20.1 billion in 2019 to US$33.7 billion in 2023, while growing net income by 190 per cent from US$1.86 billion in 2019 to US$5.4 billion in 2023.

It made significant headway towards continuing this track record with US$9.3 billion in revenue and US$2.3 billion in net income in Q1 2024, while paying down US$400 million in senior notes with cash on hand, finishing the quarter with gross debt of US$14 billion and cash and cash equivalents of US$7 billion.

Financial highlights from Netflix’s Q1 2024

All figures in US$. (Source: Netflix)

Netflix now commands a global paying audience of 269.6 million as of March 31, which is equivalent to about 8 per cent of TV viewing in the United States, backed by a diverse roster of original programs such as “Griselda,” “3 Body Problem,” “Fool Me Once” and “The Gentlemen,” and a crackdown on password sharing, with the company estimating that more than 100 million people were making use of an account they didn’t pay for.

With an eye on further growth, the streaming leader recently introduced more live programming, including stand-up, wrestling and boxing, as well as its extra member feature and an ad-supported version to widen its total viewer base, which is composed of more than half a billion people across more than 190 countries.

Netflix’s 2024 outlook

For fiscal 2024, Netflix is forecasting revenue growth of 13-15 per cent, free cash flow of approximately US$6 billion, cash content spend of up to US$17 billion, and an operating margin of 25 per cent.

It expects a tepid performance in Q2 2024, with lower net paid additions, lower net income and revenue growth of only 1.1 per cent quarter-over-quarter because of typical seasonality, though average revenue per member is expected to be up year-over-year on an FX-neutral basis.

About Netflix

Netflix is one of the world’s leading entertainment services with almost 270 million paid members. It offers TV series, films and games across a wide variety of genres and languages.

Netflix Inc. (NASDAQ:NFLX) stock opened with a loss of 7.79 per cent, trading at US$563 per share. The stock has added more than 80 per cent year-over-year, but only about 55 per cent over the past five years.

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