ad
Forex Brokers Award 2020
Vote your favourite broker
Trade 100 Bonus - the best offer on Forex market

Netflix Expands Internationally

Jul 15 2019, 07:26 AM (BDT) | ATFX

NFLX EARNINGS PREVIEW: Netflix Expands Internationally

Netflix focus has turned to international expansion as the fast growing company is looking for new clients. Netflix is working on projects across many countries such as Italy, Mexico, Brazil, Spain, Germany, France, and Turkey. It also has a strong portfolio of shows in India, with over twelve local language originals and twenty local language movies. The latest move will be in London, England, where Netflix will establish a dedicated production hub as the company grows its presence in Great Britain. Examples of the growing number of UK based projects to be filmed this year, include The English Game, Cursed and Jingle Jingle.

Netflix strategy is to expand globally as fast as possible while maintaining profits. The international markets that NFLX has a presence in are growing quickly and have already contributed positively to the bottom line. International markets continue to grow and generate meaningful profits that boost the expansion in the rest of the world. The company has added 24.81 million users from the end of Q1 2018 until Q1 2019.

The stock’s 52-week range is $231.23 to $419.77, and the capitalization stands at 166.9B. In the table below, you can find the NFLX stock price performance from one month to 10 years.

Pic 1

The company for the first quarter of 2019 reported that average streaming paid users increased by 26 percent annually, while the Annual Revenue Per User (ARPU) shrunk by 2 percent over the year due to FX fluctuations. Excluding exchange rate issues, the international streaming ARPU increased 3 percent (YoY). Year over year total revenue growth of 22 percent compares against 40 percent in Q1’18, which boosted from several price changes that took place in Q4 2017 as well as forex. On a forex neutral basis, Q1 2019 revenue grew 28 percent year over year.

The company expects to grow from 60 to 90 million users in the USA, based upon company’s history and the continued growth of online entertainment. The operating margin structure is set mostly top down. The company for the next quarter forecasts the revenues and decides what to spend, and how much margin they want in that period.

Netflix started in 1997 as a DVD rental by mail, the company spent five years struggling to find a sustainable growth plan that was cash flow positive. The company spent most of the next five years competing with Blockbuster. The streaming business started in 2007, and internationally in 2010. The first original series started in 2013. The company became global in 2016, almost twenty years after starting Netflix. I expect in the coming decades, internet entertainment to replace TV, and the NFLX will be the major player in the industry.

The competition has intensified in the last years as big internet and entertainment names enter the market such as Amazon Prime, Disney Plus, and Apple TV. A big advantage of the company is that is offering several different tiers of pricing so that clients can select a plan that best fits their needs. NFLX also tests different approaches to pricing with different plans and prices, to better cover client demand.

FX exposure is a new headache for the company as it is growing internationally. NFLX engages in hedging, in which the spending on international markets is paid in the country currency to match the revenue collected from local users. The company also adjusts prices aggressively to mitigate the negative effects of foreign exchange risk.

In the technical side, the picture is bullish for the stock as it trades above all major moving averages. The uptrend started from June 14 can lead the prices to new 52 week high; the catalyst for this move can be provided by the 2Q results. Immediate support for the stocks stands at $385 the high from May 3rd, while a break above can drive prices at $419 the 52 weeks high. On the downside, first support stands at $360 the 50 and 100-day moving average, while next support can be found at $342 the low from June 17th.

NFLX will release its 2Q 2019 financial results and outlook on Wednesday, July 17th. The market expects EPS of $0.56 while the consensus for revenue is at $4.94B.

pic 2



Written by Nikolas Papas, Market Strategist, InvestingCube.com and ATFX


Nikolas Papas

Nikolas Papas has been in the finance industry for over fifteen years in roles spanning across. Europe and USA and has acquired in-depth knowledge and experience within many aspects of the financial markets. Nikolas has worked for some of Europe's leading brokers, as an equity Analyses, and a trader managing accounts for both private and corporate investors. He enjoys both the fundamental and technical aspects of trading and focuses on stock markets and all FX majors. Currently, Nikolas provides analysis and comments on online financial publications. He studied and completed a degree in Economics (BSc), and Finance (MSc).

Pic 4

 

What is your view on Netflix? Trade it now with ATFX

This information has been produced by a third party, for general information purposes only, and is not indicative of future results. AT Global Markets UK Ltd (ATFX UK) takes no responsibility for its accuracy or completeness. Any opinions expressed do not reflect those of ATFX UK. This information does not take into account your personal circumstances or objectives, and should therefore not be interpreted as financial, investment or other advice, or relied upon as such. It has not been prepared in accordance with legal requirements designed to promote the Independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. We aim to establish and maintain And operate effective organisational and administrative arrangements with a view to taking all reasonable steps to prevent conflicts of inter Est from constituting or giving rise to a material risk of damage to the interests of our clients. You should seek independent advice before making investment decisions. Reproduction of this information, in whole or in part, is not permitted.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 72% of retail investor accounts lose money when trading CFDs/Spread betting with this provider. You should consider whether you understand how CFDs/Spread betting work and whether you can afford to take the high risk of losing your money.

Please note: If you are a Professional client, you are not eligible for negative balance protection and you could lose more than your initial deposit.

Legal: AT Global Markets (UK) Limited is authorised and regulated by the Financial Conduct Authority (FCA) in the United Kingdom. FCA registration number (760555). Registered Office: 32 Cornhill, London, EC3V 3SG. Company No. 09827091

ATFX

About ATFX A global award-winning forex broker, ATFX was established with the aim of providing a robust online trading platform for retail traders interested in trading, forex, cryptocurrency, precious metals and energy CFDs and. Today, the company, headed by an elite management team, has a global presence and offers a wide range of trading products. To ensure a seamless trading experience, the company offers MetaTrader 4, the most popular trading platform in the world, while connecting MT4 with the top liquidity providers with the latest bridging technologies. Due to its client-focus, ATFX also offers free access to market research, courses for all levels of trading, from novices to advanced levels, 24/5 live help and customer support, and highest level of protection for traders. Awards The outstanding performance of ATFX in our services have gained recognition from the market. During the year under review, the brand achieved over 20 international awards in 2018, included FX Broker of the Year, UK, Fastest Growing Forex Broker, Europe and Best Trader Education Service Provider. It regarding service, trading instruments, and the development in recognition of its commitments to excellent service to traders in corporate governance. Staffs are ATFX’s most valuable asset With close to 400 employees in offices around the globe, it aims to establish a strong footprint. ATFX now has websites in multiple languages tailored to each of the regions it serves and aims to provide the best-in-class products and services. From its user-friendly online trading platform to its multi-lingual customer support, offered by skilled and experienced professionals, ATFX takes pride in providing a safe and easy trading environment along with prompt help in the language that local traders (e.g. Europe, China, Southeast Asia …) are most comfortable in. Investors Education Following nearly 500 seminars that were successfully held during the last 12 months. ATFX has continued its principled commitment of educating its investors by conducting a series of seminars across the world, which are free and educate its participants about various trading techniques and helps learn the basics of risk management. It looks to provide a holistic service which includes the trading platform, along with a team of skilled and experienced professionals, allowing clients to gain access to comprehensive trading services. Website:www. atfx.com Hotline: 0080 112 7901 [email protected] [email protected] Legal: ATFX is a trading name of AT Global Markets Limited (ATGM, registration number 24226 IBC 2017). ATGM is an International Business Company in Saint Vincent and the Grenadines. Registered address is : the Financial Services Centre, Stoney Ground, Kingstown, St.Vincent& the Grenadines.
ad