Netflix After Q2 2019 Post-Peak or Strategic Reset?
The 20,000 Foot View: With a market capitalisation times its current annual net income, Netflix suddenly finds itself scrambling to justify its price-to-earnings ratio. The July earnings call knocked off the market capitalisation of the poster-child of the streaming era in a matter of two days – equivalent to the entire market capitalisation of Snap Inc, another former darling of the tech and media landscape. Peak streaming is meeting peak attention and the clash is pronounced and severe for Netflix. With well-funded direct to consumer threats just around the corner, Netflix needs to recalibrate both its engagement and its revenue mix to win over the next million.
of US consumers use Netflix on a daily basis
- The majority US year olds are Netflix active users (DAUs)
- Netflix domestic declined by thousand in 2019
- Netflix international growth in declined by to
- Localisation strategy more than just original content
- The next Netflix subscribers will come from markets
- Netflix paying are more likely than the consumer to pay attention to that sponsor shows than those just have ads of Netflix’s paid subscribers respond favourably to relevant ads – above the weighted average
- US Netflix are slightly more tolerant of appearing on a streaming video de-mand (SVOD) service
- US Netflix over-index for gaming behaviour
Companies and brands mentioned in this report: Apple TV+, Assassins Creed, Cambridge, Disney +, Game of Thrones, HBO, Kahn Academy, Master Class, Mirriad, MIT, Netflix, Nike, Open University, Snap Inc, Stanford, Stranger Things, Warnerflix, WarnerMedia