LOS ANGELES — Netflix is due to report fourth-quarter earnings after the closing bell Tuesday.
Wall Street will be paying close attention to details surrounding the company’s advertising-supported business model, its recent collection of live sporting events and the continued impact of its password crackdown on subscriber numbers.
After all, this is expected to be the last time Netflix will report subscriber data to shareholders, as it plans to focus on revenue and other financial metrics as performance indicators.
Here’s what Wall Street expects for the company’s most recent quarter:
- Earnings per share: $4.20, according to LSEG
- Revenue: $10.11 billion, according to LSEG
- Paid memberships: 290.9 million, according to StreetAccount
“Netflix has established a virtually insurmountable lead in the streaming wars,” wrote Alicia Reese, analyst at Wedbush, in a recent research note. “Netflix can retain its moat while competitors try to replicate its business model. Even as Netflix has lapped the password-sharing crackdown, we expect its advertising tier to drive revenue growth for several years. So far, the introduction of the ad tier has limited churn, lowering pressure on adding new subscribers, with at least 30 million accounts converting to the ad tier in the past six months.”
Reese noted that Netflix is positioned to accelerate revenue from its ad tier as it continues to add more live events, improves its ad targeting and establishes new partnerships. She said she expects Netflix’s ad tier to be its primary growth driver by 2026.
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