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Netflix (NFLX) Set to Report Q4 Earnings: What to Expect?

Zacks Equity Research
·3-min read

Netflix NFLX is set to report fourth-quarter 2020 results on Jan 19, 2021.

The company forecasts its fourth-quarter earnings to be $1.35 per share, implying year-over-year growth of 3.8%.

The Zacks Consensus Estimate is currently pegged at $1.38 per share, up 0.7% over the past 30 days. Moreover, the figure indicates 6.2% growth from the year-ago quarter’s reported figure.

Further, total revenues are anticipated to be $6.57 billion, up 20.2% year over year. The consensus mark for fourth-quarter revenues is currently pegged at $6.60 billion, suggesting 20.8% growth from the figure reported in the year-earlier quarter.

Notably, the company missed the Zacks Consensus Estimate in three of the trailing four quarters, missing the same in the one, the average surprise being 28.9%.
 

Netflix, Inc. Price and EPS Surprise

 

Netflix, Inc. Price and EPS Surprise
Netflix, Inc. Price and EPS Surprise

Netflix, Inc. price-eps-surprise | Netflix, Inc. Quote

 

Let’s see how things are shaping up for this announcement.

Factors to Consider

Netflix is expected to have faced stiff competition from the launch of new services like Disney+ from Disney DIS, HBO Max, Peacock and Apple TV+ from Apple AAPL, as well as existing services like Amazon AMZN prime video.

However, courtesy of its diversified content portfolio, which is attributable to Netflix’s heavy investments in production and distribution of localized, foreign-language content and an expanding international footprint, the company is dominating the streaming market.

Moreover, Netflix is expected to have benefited from increased consumption of media content due to coronavirus-induced social distancing and lockdowns.

Netflix expects to end the fourth quarter of 2020 with 201.15 million paid subscribers globally, indicating growth of 20.4% from the year-ago quarter.

This Zacks Rank #3 (Hold) company expects its paid-subscriber addition to be 6 million in the to-be-reported quarter, much slower than 8.76 million it added in the year-ago quarter. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for paid total streaming net membership addition is pegged at 6.19 million.

The consensus mark for Asia Pacific (APAC) revenues are pegged at $673 million, indicating 6% growth from the figure reported in the previous quarter.

The Europe, Middle East & Africa (EMEA) revenues are pegged at $2.09 billion, suggesting 10.5% growth from the figure reported in the previous quarter.

Moreover, the consensus mark for United States and Canada (UCAN) revenues are $2.98 billion, indicating 4.8% growth from the figure reported in the previous quarter.

Further, the Zacks Consensus Estimate for Latin America (LATAM) is pegged at $823 million, suggesting 4.8% growth from the figure reported in the previous quarter.

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