$NFLX Misses On New Subscribers

Earnings reported 20 JAN 22 amc

Profit:           +$1.33 per share
eBEAT:            +62.20%
rMISS:            -0.01%
Earnings Growth:  +11.80%
Revenue Growth:   +16.00%


Going into this week, Netflix shares were already down about 25% from their mid-November peak. Investors have been fretting for weeks about the company’s ability to deliver eye grabbing content without breaking the bank on bloated content budgets while also maintaining subscriber growth. To try and boost growth, the company packed the back end of 2021 with high profile releases including star-studded action comedy Red Notice and climate satire Don’t Look Up, which have already become the company’s two most viewed original movies.

None of that seems to have paid off much. The reopening of the economy in 2021 shifted people away from screens and Netflix’s customer growth fell in half from 2020, when lockdowns led to historic signup numbers. Amazon’s Prime, AT&T HBO Max, and Walt Disney’s Disney+ crowding the streaming market hasn’t helped, either. But even with all that, Thursday’s numbers were a letdown:

  • Netflix reported 8.3 million net new subscribers in the fourth quarter, below its own projection of 8.5 million and leading to the company’s slowest annual growth since 2015 — the stock fell as much as 18% in after hours trading to its lowest since June 2020.

  • Even worse, Netflix said it expects to add just 2.5 million subscribers in the first quarter of 2022, way below the 4 million it added last year.

Alert! Last trade in the after hours was $405.50 or down -20.22% from yesterday’s close of $508.25

My twitter thread showing Daily, Weekly, and Monthly charts at end of day before the earnings drop in the after-market.

The gap down tomorrow will bring out the daytraders and sellers on a big volume move.