Netflix has been on a rollercoaster the last couple years, hasn’t it? It seems like it was just yesterday that it was perched on the top of the streaming mountain – a single solitary king surveying the land all around him. It was definitely ahead of the curve when it came to digital home entertainment… But it wasn’t too long till everybody saw the writing on the wall – as well as the money flooding in – and they started jumping on the streaming bandwagon as well. And with all those companies jumping into its space… It cut into their money. So, it got down to the business of figuring out new ways to get more money in order to keep shareholders happy. And what idea did they come up with? What was their brilliant plan? Stop people from sharing their passwords… That’s it. Not a new show, not an exclusive deal with an actor or writer… But cracking down on people for sharing their passwords. Did it pay off? Keep reading and find out… Ah, the great Netflix (NFLX) password purge… A move that turned living room harmony into battlegrounds for remote control dominance. But did it pay off for streaming giant? So, turns out, over a hundred million households were cozying up to Netflix accounts that weren’t theirs… Blocking these freeloaders didn’t just earn Netflix a gold star for ethics – it also roped in over 9 million new subscribers. Analysts probably had to pick their jaws up off the floor at that one. Those 9 million new subscribers made Netflix’s pockets 15% heavier last quarter – with profits soaring an impressive 83%. But for some reason, it wasn’t enough to put it back on the path to top of mountain… Blame it on its underwhelming sales forecast for this quarter. Oh, and if that weren’t enough… It is basically taking its ball and going home when it announced that it would no longer share those oh-so-juicy subscriber numbers with the analysts. This move just made the market playground a little less fun. Of course, with the economy being what it is – there’s about 9 million people who are a little miffed they’re paying for something they used to get for free… But hey, Netflix isn’t sweating – it has a buffet of exclusive content and profit margins sitting pretty at 25%. It could probably keep this gravy train chugging along in the double-digits for years… Again, if it weren’t for the current economy and its inflation woes. Ah, yes, the economy, that fickle beast. A downturn could see subscribers canceling faster than they can hit “next episode” … And if inflation decides to rear its head again – Netflix might find itself between a rock and a hard place – unable to hike up prices without sending subscribers running for the hills. And let’s not forget, Netflix’s decision to go mute on subscriber numbers means it will be banking more on advertising revenue – something that is also dependent on a seemingly steady economy. But hey, it’s a dog-eat-dog world in the streaming business. Every subscriber brings in a measly trickle of cash – while the costs keep piling up like dirty laundry. No wonder Disney’s (DIS) still crying over its losses. But guess who’s laughing? Netflix. More and more entertainment moguls are lining up to sell their content to the OG of streaming – turning Netflix into the pawnshop of their world. You know what they say – one man’s trash is another man’s treasure. All that said, will Netflix emerge as the hero or the villain for shareholders? Is it a profit play? Well, that remains to be seen for most people. Of course, members of GorillaTrades know if it is or not – because if they were – they’d have gotten a recommendation. Our trading matrix is all based on numbers and data… So, if a company like Netflix or Disney looks like it’s going to go on a run – they’ll have the numbers behind it to prove it. I’d love to show you how it works – but of course – you need to be a part of GorillaTrades to truly grasp how we’ve helped so many members get the chance to make so much money… So, I’m inviting you to become a member today. Of course, we understand that “joining” isn’t everybody’s thing – but know if you’re ever lost or feel like you can’t get a handle on today’s market… We’re always here to help when you’re ready. Either way – you may want to take a closer look at Netflix – it could be more than a streaming service… It could be your ticket to $$$.
“Most entrepreneurial ideas will sound crazy, stupid and uneconomic, and then they’ll turn out to be right.” – Reed Hastings |
