The streaming leader has lost more than 20% of its value this year due to concerns surrounding its growth initiatives, particularly the advertising segment, which is still not a significant revenue generator.
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Analysts surveyed by LSEG anticipate a 13.6% increase in revenue, bringing it to $12.59 billion, marking its slowest growth rate in over a year, with adjusted earnings per share projected at 79 cents.
The advertising sector, viewed as vital for Netflix’s expansion as the impact from the crackdown on password sharing and recent price hikes diminishes, is expected to generate $705.8 million in revenue.
“We had to revise our (advertising) forecast,” said Emarketer analyst Ross Benes, noting that the ad business has not expanded as robustly as initially predicted by many analysts.
To attract advertisers and enhance engagement, Netflix is venturing into live events. CNBC has reported that the company is considering a bid for the U.S. rights to the 2030 and 2034 FIFA World Cups and is in discussions to acquire the online film platform Letterboxd.
“The company has shifted from disruption to dominance, with the current challenge being to maintain momentum from a much larger base,” stated PP Foresight analyst Paolo Pescatore.
Bloomberg News highlighted earlier this month that Netflix viewers are increasingly less inclined to return for subsequent seasons, with popular series like “The Night Agent” and “Beef” observing a drop of roughly 50% or more in audience numbers after their first seasons.
Comcast’s NBCUniversal spinoff has also sparked speculation about potential deals, though some analysts predict that Netflix will concentrate on smaller acquisitions rather than pursuing another major one.
