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Netflix Earnings Miss in Q1 Despite Jump in Subscriptions

imageStock Markets5 hours ago (Apr 21, 2020 04:03PM ET)

(C) Reuters. Netflix Earnings Miss, Revenue Beats In Q1 – Netflix reported on Tuesday mixed first-quarter results as earnings missed, but revenue topped expectations as lockdown measures nationwide triggered a wave of new subscriptions.

Netflix (NASDAQ:NFLX) was up about 1% in after-market hours.

Netflix announced earnings per share of $1.57 on revenue of $5.77 billion. Analysts polled by anticipated EPS of $1.63 on revenue of $5.74 billion. That compared with an EPS of $0.76 on revenue of $4.52 billion in the same period a year before. Netflix had reported EPS of $1.30 on revenue of $5.47 billion in the previous quarter. Analysts are expecting EPS of $1.53 and revenue of $5.95 billion in the upcoming quarter.

The company reported global streaming paid net additions of 15.7 million in the quarter, well above consensus estimates of about 8.5 million. The company guided second-quarter net additions of 7.5 million. That compared to 8.76 million net adds during the prior quarter and 9.6 million net adds year on year.

“(W)e have seen significant disruption when it comes to customer support and content production. On the customer support side, we’ve now fixed most of our work-from-home challenges. In addition, we’ve taken on another 2,000 agents (all working remotely), so our customer service levels are almost fully restored despite the increased demand,” Netflix said in reference to the current Covid-19 pandemic.

Following the report, analyst Haris Anwar said that despite its blockbuster earnings, Netflix is likely to meet resistance in the short run amid a lack of guidance.

“Netflix has released a blockbuster quarterly report, well ahead of market expectations. The company’s strong subscriber gains show that it’s the ultimate stay-at-home stock, following the coronavirus pandemic. But there is no guarantee that a global recession and increased competition will not hit Netflix in the later part of the year. There is little clarity from the company about the future and that’s likely to hurt the stock in the short- un,” Anwar said.

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Netflix Earnings Miss in Q1 Despite Jump in Subscriptions

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