CFDs are complex instruments. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money. CFDs are complex instruments. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.

Netflix shares: subscriber data in focus for Q1 as Russia ban enforced

After Netflix suspended operations in Russia in March, investors will likely keep an eye out for the streamer’s subscriber data, including growth guidance, as an estimated 1 million Russian accounts could have been closed.

(Video Transcription)

Netflix Q1 earnings preview

First quarter (Q1) earnings season is in full swing and it's going to be the turn of Netflix next week. They'll be reporting on Tuesday.

We are expecting earnings per share (EPS) to come in at $2.95 with revenues coming in at $7.94 billion. The streamer did suspend operations in Russia at the beginning of March amid the invasion of Ukraine and it's largely expected they are going to take a hit from the ongoing geopolitical crisis.

Netflix technical analysis

Let's bring up a chart of Netflix to see how the share is performing, because we have seen Netflix drop a big amount since the beginning of the year.

Remember, back in January, we saw that fourth quarter report. They were saying that they had weak subscriber growth guidance for the next few months and shares plummeting there, as you can see, really dropping here in mid-January, heading towards those lows that we saw back here on the 15th of March.

A lot of analysts are going to be looking for that subscriber growth figure, especially because it's estimated that around one million subscribers could have dropped out from Russia because of the aforementioned ban.

Also, heading into the next few quarters, what's that subscriber growth looking like? Are they going to be able to keep up to those demands?

Looking at the share price here, as you can see, we have seen a recent pullback starting here at the beginning of April coming into that selloff that we've already seen back here, from those highs in November. The selloff does look a little bit extended.

Let's zoom out a little bit here so we can see further out. To me, it seems a little overextended, but we are back at those levels that we saw prior to the pandemic-induced rally. So this potentially means that buyers, or new buyers, are going to be more comfortable coming into the market. So we are looking for those key levels.

$332, that's an area where, in the past, we've seen quite a bit of support, as you can see. This is back here in April 2019, before we saw that dip there at the end of 2019, coming into that move towards those highs there back in 2020.

So, all-in-all it does look like Netflix might be off to a bit of a rough start in the first quarter of the year. It's a question of how much that's already priced in given these expectations of subscriber losses in Russia. Is this where this pullback has come? Are we expecting Netflix to potentially pick up a bit more buying momentum if we do see new buyers coming into the market?

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. 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.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.