A big jump in subscribers sent shares of Netflix soaring toward their best day in about 21 months Wednesday, even as the company’s outlook and plans to tap into new revenue sources were dividing analysts.
Analysts at JPMorgan also struck an upbeat tone as Netflix readies for the new monetization initiatives. In addition to plotting its password-sharing crackdown, the company intends to roll out a streaming plan with ads next month in markets including the U.S., Germany and Japan that will cost around $6.99 a month.
Separately, Evercore noted that foreign-currency headwinds from Netflix’s international exposure “came in worse than we anticipated,” but Evercore maintained its outperform rating on Netflix shares.Michael Hewson, chief market analyst at CMC Markets U.K., said the fourth-quarter outlook was on the “weak side,” making the premarket share-price increase “somewhat perplexing.” The company anticipates that 4.5 million new subscribers will join in the fourth quarter, while revenue could grow to $7.
The new efforts come with puts and takes, noted MoffettNathanson’s Michael Nathanson, even though he thinks they “make sense” in theory. Other analysts expressed uncertainty over how fast the new ad-supported plan could bring in subscribers and revenue.
Rip Netflix
You also can’t download for offline and not all content will be available and they’ll collect demographic data to tailor ads and it’ll be lower quality picture. Crappy idea!
back to good ole TV commercials