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Netflix finally told investors what they wanted to hear. Now comes the most difficult stage.

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Netflix finally told investors what they wanted to hear.  Now comes the most difficult stage.

Not so long ago, the Wall Street stock market was stunned by such gloomy news from Netflix: between April and June the company lost 970,000 subscribers.

But investors are not embarrassed by the number of customers who have dropped out of the service. In fact, they are even happy.

What’s happening: Netflix (NFLX) shares rose more than 6% versus the stock market on Wednesday after the company reported its latest results. Will the reasoning be linear? It could have been much worse.

“It was a quarter where ‘the less bad news, the better,'” analysts say. Individual investment group in a note to customers.

Netflix is ​​struggling to shape its curve in the market – the company’s stock has fallen 62% in the past 12 months.

What’s happening: Netflix has already lowered expectations as much as possible. it is predicted to lose 2 million subscribers in the last quarter after losing 200,000 in the first three months of the year. This made room for surprise, unexpectedly, on the positive side.

“We are talking about a loss of 1 million, not a loss of 2 million,” President Reed Hastings said in a statement to analysts. “So our enthusiasm is overshadowed by less bad results.”

The biggest loss of Netflix subscribers came in its biggest market, the US and Canada, where the streaming service confirmed it lost 1.3 million users in the second quarter.

This was offset by an increase in subscriptions elsewhere, indicating that the company’s investment in foreign language programming is paying off. The release of the fourth season of the popular series “Stranger Things” also gave impetus.

Future Prospects: Netflix still has a lot of work to do to reassure investors that the company is on the right track. To date, its shares have fallen nearly 67%. Shares of other tech companies such as Alphabet, which controls Google, and Facebook Meta were down 21% and 48%, respectively. The S&P 500 is down 17%.

This will lead to major business changes. Netflix has partnered with Microsoft to create a new ad-supported, cheaper option in a bid to win over customers who are more worried about their spending when inflation tightens. Its release is expected early next year.

Furthermore, also trying to stop password sharing. The company estimates that 100 million households use Netflix but don’t pay for the service directly.

“We know this will mean a change for our associate members,” he told shareholders. “Our goal is to find an easy-to-use paid exchange offer that we think will work well for our members and for offers we can launch in 2023.”

Rich Greenfield, an analyst at LightShed Partners, believes Netflix’s move to advertising could be a success.

“Netflix advertising opportunities are real and directly related to the amount of time spent on this streaming service compared to all other services,” he added in his Twitter post.

But projecting this big change will not be easy. Netflix’s entry into the advertising space will not be easy. Competition for viewers among streaming services is tough. And if a large group of subscribers choose the cheapest version to save money, it will reduce revenue even if new users subscribe.

“We urge caution in the belief that Netflix can use ads to increase revenue out of thin air,” Bank of America analysts said in a report released late last month. “The advertising ecosystem is big, complex, expensive, and their ad-using competitors have a long-term advantage over them.”

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Economy

The UK is preparing for electricity and gas to run out next winter. Worst-case scenario points to 4-day blackouts

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The UK is preparing for electricity and gas to run out next winter.  Worst-case scenario points to 4-day blackouts

Summer is still on, but winter is fast approaching, and European countries are making contingency plans to avoid running out of energy while Russia cuts back on the amount of gas it sends to Europe.

Based on a “reasonable worst-case scenario”, the British government is already gearing up for several days of the winter months when the cold could combine with gas shortages, causing “power outages” across the country, reaching industry and homes. .

Unidentified sources tell Bloomberg that London’s forecast is that the electricity grid will only be able to guarantee a sixth of the power during peak demand, after the government presented contingency plans to reopen coal-fired power plants. .

The worst-case scenario assumes that the United Kingdom will suffer blackouts for four days in January 2023 and that it will have to activate measures to reduce gas consumption at a time when gas supplies from Norway and France are also reduced. , while every country tries to secure its supplies for the coldest months of the year.

However, the British government believes that the worst scenario may not materialize, but does not rule out the possibility that, in the end, it will come true.

Bloomberg notes that this problem should be dealt with by whoever succeeds outgoing Prime Minister Boris Johnson next September. In a worst-case scenario, Liz Truss or Rishi Sunak will have an energy and social crisis on their hands, as the British public has expressed great dissatisfaction with a significant increase in the cost of energy, which could double in the face of rising inflation. and reduced purchasing power.

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Economy

In Russia began to dismantle aircraft for spare parts – Aviation

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In Russia began to dismantle aircraft for spare parts - Aviation

Russian airlines, including state-owned Aeroflot, are stripping planes to secure spare parts they can’t buy abroad due to Western sanctions, Reuters reported, citing four industry sources.

The companies are following Moscow’s guidance in June and are reaching out to some aircraft to get the parts they need to keep the rest of the fleet operational until at least 2025.

A source told Reuters that at least one Sukhoi Superjet 100 and one Aeroflot Airbus A350 are being dismantled, with the Airbus jet being “almost new”.

But the state-owned company has also stripped parts from some Boeing 737s and Airbus A320s to keep other planes of the same model flying.

Almost 80% of Aeroflot’s fleet is owned by the two largest aircraft manufacturers – 134 Boeing and 146 Airbus aircraft, and about 80 aircraft – Russian-made Sukhoi Superjet-100, which, according to the latest data, use many foreign-made parts, Reuters notes.

It will also be difficult for Moscow to buy parts from countries that have not imposed sanctions against Russia after the invasion of Ukraine. Asian and Middle Eastern airlines fear “secondary sanctions” from the West if they supply equipment, a source told the agency.

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Economy

After all, how much lower fuel prices? See accounts here

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After all, how much lower fuel prices?  See accounts here

Ethis week started with lower fuel prices, which was found for both diesel and gasoline. The fall averaged seven cents, slightly below forecast.

Average price for simple diesel fuel fell in price to 1746 euros per liter (€/litre) on Monday, August 8, compared to 1816 euro/litre on Sunday. it discount seven cents.

Me and simple gasoline 95 cost, on average, €1805/liter on Monday, minus 7.3 cents than the 1,878 euros per liter registered the day before, according to data released by the Directorate General for Energy and Geology (DGEG).

With proven descent on plain petrol 95the price of this component returns to pre-war levels in Ukraine. Let me remind you that on February 23, the average price of regular gasoline 95 was 1816 euros / liter. On the same day of the invasion, plain gasoline 95 also cost €1,816 per litre, compared to the current €1,805 per litre..

Dynamics of fuel prices since the beginning of the war© DGEG website reproduction

The average price at gas stations for the week from 1 to 7 August in the case of gasoline was 0.9 cents higher than the ERSE weekly average price and 0.1 cents lower for diesel.. The information is contained in the Weekly Report on Supervision of Sales Prices to the Public, posted on Monday Energy Services Regulatory Authority (ERSE).

“Regarding the previous week, it was found that the average selling price for the public, announced on the porticos and published in the Balcão Único da Energia, was 0.9 cents per litre. [cêntimos/litro] higher than this week’s effective price for plain gasoline 95 and 0.1 cents/liter lower for plain diesel.”

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Thus, according to ERSE, “in percentage terms, plain 95 gasoline was declared on taps 0.5% above the effective price, and ordinary diesel fuel was declared 0.1% below the effective price.”

Read also: Fuel is cheaper today (and could return to pre-war prices)

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