October 14, 2019
With Netflix to report third-quarter (ended Sept. 30) financial results Oct. 16, all eyes will be on subscriber growth and whether the SVOD behemoth meets its 7 million global net sub additions estimate, including 800,000 in the United States.
Netlfix has projected topping 158 million subscribers world wide by the end of Q3.
Failure to meet projections on the eve of competitive service launches by Apple and Disney in November could see Wall Street continue to hammer the stock, which is down 33% since year-to-date high of $415 per share on June 20.
But perennial Netflix bear Michael Pachter with Wedbush Securities in Los Angeles contends the streaming service will meet its sub guidance due to a series of new releases in the quarter, including most notably the third-season launch of “Stranger Things” on July 4.
“Upside to total subs guidance appears likely given the solid slate of new content that debuted in Q3, which should help dampen domestic churn,” Pachter wrote in a note. “We think guidance is easily attainable.”
That said, the analyst believes the Nov. 12 launch of Disney+ will expedite the impending loss of most Disney and Fox content, or about 25% of total viewing hours.
“We estimate that content from Comcast, Fox, Disney and Warner Bros. presently accounts for 60% to 65% of Netflix viewing hours, and we expect most of it ultimately to migrate away,” Pachter wrote.