Latest news with #NetflixInc
The Star
3 days ago
- Business
- The Star
After stock market's torrid run, earnings misses face punishment
NEW YORK: The second-quarter earnings season is off to a ripping start, with consumer strength powering resilient corporate profits. In the stock market, however, the reaction has been fairly quiet, an ominous sign that much of the good news is priced in - and investors are punishing disappointments. Take financials, which reported blockbuster numbers this week that failed to juice their shares. 'Financials have crushed second quarter earnings expectations with a 94.4% beat rate so far, yet stocks saw only muted reactions as investors largely anticipated the results,' Bloomberg Intelligence strategists Gina Martin Adams and Michael Casper wrote in a note last Friday. Similarly, streaming platform Netflix Inc exceeded outlooks in every major metric, and United Airlines Holdings Inc was upbeat about travel demand gaining steam. Yet, investors largely reacted to these numbers with a collective shrug. Netflix closed down over 5% last Friday despite its strong performance. 'With stock valuations where they are, all the good news is priced into the market now,' said Greg Taylor, chief investment officer (CIO) at PenderFund Capital Management Ltd. What's more, the market is penalising results that fall short of expectations by the most in nearly three years, data compiled by Bloomberg Intelligence showed. 'The margin of error here is small,' said Michael Arone, chief investment strategist at State Street Investment Management. 'When the valuations are high and you miss, the punishment is more severe.' Combined profit and revenue beats, on the other hand, are being rewarded by only the most in a year. 'At an index level, good earnings are not likely the broad market catalyst investors are waiting for,' said Julian Emanuel, chief equity and quantitative strategist at Evercore ISI. The S&P 500 Index closed near an all-time high Friday, after notching seven new records in just 15 sessions. The equities benchmark is trading at 22 times expected 12-month profits and is fast approaching the level it hit in February, before April 2 when President Donald Trump unleashed his global tariffs that weighed on sentiment. This week, investors will get results from a slew of Big Tech giants including Alphabet Inc and Tesla Inc, industrial behemoth Honeywell International Inc, chemicals maker Dow Inc, defence contractors Lockheed Martin Corp and Northrop Grumman Corp, and auto manufacturer General Motors Co, among many others. Big US banks delivered an earnings bonanza based on record-breaking trading revenues, as the volatility sparked by Trump's tariff offensive ignited market activity at some of Wall Street's biggest firms. Still, the share moves were underwhelming. Goldman Sachs Group Inc equities traders posted the largest revenue haul in Wall Street history, but the company's shares rose less than 1% on the day it reported earnings. Even worse, Morgan Stanley's net revenue topped estimates and the shares closed down 1.3%. And JPMorgan Chase & Co's stock traders notched their best second quarter ever, while fixed-income trading trounced expectations, yet the stock dropped 0.7%. Still, market pros noted that the powerful bank earnings offer an encouraging indication for the overall economy. 'Banks can only be healthy when the economy is strong,' said Mark Malek, chief investment officer at Siebert. 'So their earnings along with their commentary serve as a broader benchmark on economic health.' The durability of the US consumer has been a major question for investors and economists, especially in the face of still-high inflation, elevated interest rates and continued uncertainty about the new US trade regime. The initial signs are encouraging based on earnings from airlines to PepsiCo Inc to Netflix to jeans-maker Levi Strauss & Co. 'The consumer remains strong,' Malek said. 'That is paramount.' Travel in the United States is recovering with the approval of Trump's tax cut and spending package and negotiators appearing to make progress in tariff discussions, Delta Air Lines Inc chief executive officer Ed Bastian said. PepsiCo's North American business improved and it saw strong growth in international markets. Netflix raised its full-year forecast. And Levi Strauss said it expects sales growth to outweigh the impact of Trump's tariffs. Retail sales figures last Thursday offered proof of this continued strength. Commerce Department data showed the value of retail purchases, not adjusted for inflation, increased 0.6% after declines in the prior two months, exceeding nearly all estimates in a Bloomberg survey of economists. 'So far it has been a thumbs up from earnings,' Malek said. — Bloomberg
Mint
6 days ago
- Business
- Mint
Netflix Q2 revenue jumps 16% to $11.1 billion, company raises forecast
While rival media companies are unloading assets and cutting costs, Netflix Inc. continues to thrive. The owner of the world's most popular paid streaming service on Thursday reported second-quarter results that exceeded investor expectations in every major metric, saying revenue grew to $11.1 billion and earnings jumped to $7.19 a share. The company also raised its forecast for full-year sales and profit margins. The second quarter is historically slow for Netflix, which typically adds more customers at the beginning and end of the year. But the company released a steady slate of popular shows, including two of the most-watched titles of the year — the third season of Ginny & Georgia and the final season of Squid Game. The company also benefited from a weaker dollar. More than two-thirds of its customers live outside the US. Shares of Netflix were down about 2% at 5:44 p.m. New York time in extended trading. The stock has nearly doubled over the past year and the company's market value tops $500 billion. That makes Netflix worth more than Walt Disney Co., Comcast Corp. and Warner Bros. Discovery Inc. combined. While investors used to judge Netflix by the number of subscribers it added in any given quarter, the company has stopped disclosing how many customers pay for its service, directing them to focus on more traditional metrics such as sales and profit. In its statement Thursday, Netflix said its 16% gain in revenue reflected member growth, higher subscription prices and an increase in advertising revenue. Netflix expects to generate up to $45.2 billion in sales this year and says its operating margin is now forecast to hit 29.5%. Net income is on track to exceed $10 billion for the first time, thanks to exchange rates that will boost sales and a strong slate of programs. The second-half schedule includes new seasons of the hit shows Stranger Things and Wednesday, as well as movies such as Happy Gilmore 2. The streaming leader faces more competition for its customers' attention than ever before. Its share of total TV viewing hasn't grown in the US over the last year, and the company said that its average member is watching about the same amount of TV as a couple years ago. Netflix could increase its share of viewing through acquisitions, especially as companies such as Warner Bros. and Comcast are restructuring. But the company prefers to grow internally, Chief Financial Officer Spencer Neumann said on a call with analysts. Management expects engagement to increase in the second half of this year and believes the company can steal share from competitors. Netflix's user growth in the US has slowed, according to market researcher Antenna. The company boosted its customer base for a couple of years by cracking down on password sharing. The benefits from that program have started to wane. However, domestic revenue in the second quarter grew 15%, buoyed by recent price increases. The company is trying to draw in customers with a lower-cost, advertising-supported offering in a dozen markets. Its advertising sales are expected to double this year.
Time of India
6 days ago
- Business
- Time of India
Asian stocks edge up after US gains, dollar dips
Asian stocks made a modest gain at the open Friday as a global equity rally gained fresh vigor on strong economic data that eased concerns about the US economy . The MSCI Asia Pacific Index rose 0.2% at the open. Equity-index futures for US gained after the S&P 500 and Nasdaq 100 set closing highs Thursday. Tech stocks rose as a bullish outlook from Taiwan Semiconductor Manufacturing Co. bolstered confidence in artificial-intelligence spending. Netflix Inc. also reported strong earnings and raised its forecast. Explore courses from Top Institutes in Select a Course Category Public Policy Digital Marketing MBA healthcare Project Management Operations Management Design Thinking Product Management Leadership Healthcare Management Technology Data Analytics CXO Data Science Cybersecurity Data Science Artificial Intelligence MCA Finance PGDM others Degree Others Skills you'll gain: Duration: 12 Months IIM Calcutta Executive Programme in Public Policy and Management Starts on undefined Get Details Skills you'll gain: Economics for Public Policy Making Quantitative Techniques Public & Project Finance Law, Health & Urban Development Policy Duration: 12 Months IIM Kozhikode Professional Certificate Programme in Public Policy Management Starts on Mar 3, 2024 Get Details The yen steadied as Japan's key price measure cooled a tad more than expected, while remaining well above the Bank of Japan's target. The dollar dipped as Federal Reserve Governor Christopher Waller said policymakers should cut interest rates this month to support a labor market that is showing signs of weakness. Treasuries rose as yields on the 10-year fell for a third day. The cross-asset moves were a sign of bullish risk appetite a day after speculation President Donald Trump would fire Jerome Powell sent volatility spiking. The gains in equities reflected strong economic data and confidence US companies will deliver robust second-quarter earnings, calming the uncertainty caused by Trump's tariff war. 'As long as the economy continues to expand and unemployment remains low, then people will continue to spend and the flywheel can keep generating higher profits, which is the engine for higher stock prices,' said Chris Zaccarelli at Northlight Asset Management. Live Events A June advance in US retail sales tempered concerns about weaker consumer spending. Applications for US unemployment benefits declined for a fifth straight week to the lowest since mid-April, showing a resilient job market. Elsewhere, a White House shift on US chip bans that impacts Nvidia Corp. and Advanced Micro Devices Inc. has spurred talk of a grand tech bargain between Washington and Beijing. Separately, the US Commerce Department imposed preliminary anti-dumping duties on Chinese imports of graphite, a key battery component. Fed Bank of San Francisco President Mary Daly said it's reasonable for policymakers to plan on two rate cuts this year, emphasizing that the central bank should not wait too long before moving. Fed Governor Adriana Kugler said officials should keep holding rates steady 'for some time,' citing accelerating inflation as tariffs start to boost prices. ETMarkets WhatsApp channel )
Bloomberg
6 days ago
- Business
- Bloomberg
Netflix Is at Risk of Earnings Letdown After $250 Billion Rally
With Netflix Inc. shares trading near its highest valuations going back to 2022, there's a lot riding on the streaming giant's upcoming earnings report and its outlook for the months ahead. Expectations have been building around a second-half slate of blockbuster sequels, including the highly anticipated Stranger Things. The stock price has nearly doubled over the past year, adding about $250 billion in market value and lifting its price-to-estimated earnings ratio to 43 times, well above the Nasdaq 100 at 27 times. The firm is due to report second-quarter results Thursday after US markets close.
Bloomberg
03-07-2025
- Business
- Bloomberg
The Cushiest Job in Corporate America Is Getting Harder
Last year, Netflix Inc. held four board meetings. Jay Hoag, the company's lead independent director, showed up for only two of them. He also missed one of two meetings of the board's nominating and governance committee — which he chairs. Life happens. Things come up. People get sick or have personal issues. But Netflix didn't disclose the reason for Hoag's absence, which boards usually do when a director doesn't hit the 75% attendance threshold. Nor did the company provide any additional context when I asked for it.
