Finimize - 😱 Netflix might be canceled

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Today's big stories

Netflix reported worse-than-expected quarterly results
Goldman Sachs thinks the traditional portfolio will struggle this decade, but a few tweaks could help you profit anyway – Read Now
China’s economy grew by more than expected last quarter, but it’s slowing fast

Cancel Culture

What’s Going On Here?

Netflix reported worse-than-expected results late on Tuesday, as the streaming giant discovers how getting canceled really feels.

What Does This Mean?

Investors were expecting Netflix to report another quarter of slowing subscriber growth, but the results turned out even worse than they’d thought. Netflix lost 200,000 subscribers last quarter, with three of the four regions it covers reporting falls – marking the first time in over ten years that it has actually lost customers. The streaming giant said its higher subscription prices might've put some viewers off, and thinks its withdrawal from Russia cost it 700,000 customers too. But it looks like it could get worse still, with the company expecting to lose another 2 million subscribers this quarter as well. And since investors use subscriber growth as a measure of future profitability, they didn’t take that as a good sign: they initially sent its stock plunging 25%.

Why Should I Care?

The bigger picture: Streamers are the first to go.
It’s no wonder Netflix is struggling to add new viewers, let alone keep its old ones: data out over the weekend showed that UK households canceled streaming subscriptions in record numbers last quarter, with 25% more cancellations than the same time last year. That comes as consumers around the world cut back on life’s little luxuries to cope with rising prices – a decision that’s been made all the more imperative by streamers’ rising prices. Throw in more choice of streaming services than ever, and Netflix is facing an uphill battle.

Zooming out: Advertise here.
One way analysts reckon Netflix can make up for that non-existent subscriber growth is by selling advertising on its platform – like HBO Max already does and Disney+ is planning to do. In fact, they think Netflix could make as much as $3 billion in extra revenue if it follows suit. And since the strategy wouldn’t cost much to roll out, a substantial portion of that would go straight to the streaming giant’s bottom line.

You might also like: How to analyze Netflix’s stock in under two hours.

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Analyst Take

Is The Traditional Portfolio Headed For A “Lost Decade”?

Reda, Analyst

What’s Going On Here?

The outlook for bonds and stocks is looking bleaker and bleaker.

Ongoing supply chain issues and soaring commodity prices have got investors worried we’re on the verge of a new era of stagflation – that is, low economic growth and high inflation.

That’s a combination that simultaneously undermines the prices of stocks and bonds, draining the 60/40 portfolio – 60% stocks, 40% bonds – of its diversification mojo.

So much so that Goldman Sachs has sounded the alarm over the potential for a “lost decade” of poor returns.

But even if Goldman’s right, there are a few tweaks you can make to ol’ faithful to make sure you profit.

So that’s today’s Insight: why the 60/40 is faltering, and how to profit no matter what.

Read or listen to the Insight here

Americans sound off about crypto

Crypto sparks plenty of heated debates, that’s for sure.

Thing is, the loudest voices are often hardcore fans and crypto skeptics. So it can be hard to get a true sense of how most folk really feel about the digital coins.

That is, until business research specialist Attest surveyed Americans to find out exactly what they think of crypto these days.

Attest’s survey results show that fewer Americans said they’d invest in crypto in March than in January, for a couple reasons: 55% cited low trust levels, while 45% said they didn’t understand it.

That’s just the beginning: find out how America feels about crypto.

View Attest’s Findings