The world’s foremost OTT brand has released its first quarter 2023 fiscal report. What’s the key takeaway? A lower-than-anticipated new subscriber total was shared. Even worse, projections for Q2 that also fell below analysts’ estimates were offered by Netflix.
As is typical for Netflix, a Excel spreadsheet serving as the company’s financial statement was posted to its investor relations website, with no formal press release breaking out the earnings report. Upon opening the document, the Cash Flow tab immediately appears.
That paints a rosy picture for Netflix, with non-GAAP free cash flow coming in at $2.116 billion in Q1 2023 compared to cash flow of $801.681 million in Q1 2022.
A manual switch in tabs to the Income Statement reveals the real nitty-gritty on how Netflix fared in Q1 2023.
Revenue improved to $8.162 billion from $7.868 billion, as operating income advanced to $1.714 billion from $1.578 billion. Analysts predicted revenue of $8.18 billion.
The all-important net income declined, however, moving to $1.31 billion ($2.88 per diluted share) from $1.44 billion ($3.20 per share).
The consensus EPS estimate of 34 analysts polled by Yahoo! Finance was $2.86.
Importantly, North America revenue was up, growing to $3.61 billion from $3.35 billion. Latin America revenue hit $1.07 billion, rising from $998.95 million. Asia-Pacific revenue increased to $933.52 million from $916.75 million. However, Europe/Middle East/Asia revenue fell to $2.517 billion from $2.561 billion in Q1 ’23.
“In short, we are off to a good start in 2023,” Netflix shareholders were told by the company in a Q1 2023 investor letter.
Yet, there was early concern that the lower subscriber numbers would impact Netflix, as 1.75 million subscribers were logged versus 2.3 million net additions expected.
That hasn’t happened, with early after-hours trading pushing NFLX up $1.80 per share to $335.50 as of 5:13pm Eastern.
