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Netflix Q1 Preview: All Eyes on Subscriber Additions

Netflix earnings preview
Cheyne Gateley/VIP

Netflix will report its first-quarter 2021 earnings on Tuesday. The focus will be on how net subscriber additions in the quarter compared with management’s guidance of 6 million, with the expectation being that Netflix will slightly surpass this figure (6.3 million consensus) but be well below the monster 15.8 million adds it posted during Q1 2020. 

Netflix is always hogging headlines, but in recent months it has most notably nabbed an industry-best 35 Oscar nominations, solidified a $450 million pact for “Knives Out” sequels and secured a first pay-TV window licensing deal for Sony theatrical releases starting in 2022. Management is likely to reference at least one of these areas during its call, while analysts may be able to push for more details on the latter two developments during the Q&A. 

A key question looking ahead is how Netflix will be able to accelerate its subscriber growth as it can no longer lean on the U.S. and Canada for substantial membership additions every quarter. As pointed out in VIP’s recently published tech and media Q1 earnings preview, some of Netflix’s biggest growth opportunities lie in the APAC and EMEA regions, which is where most of the streamer’s sub growth came from in 2020. 

Netflix plans to spend $500 million on Korean original movies and series in 2021 and has already begun partnering with telecoms in Africa to make subscription payments easier, and these efforts could help lessen the impact of the streamer’s stagnating U.S./Canada growth as services like Paramount+ and Discovery+ get off the ground. 

This is part of a series of Variety Intelligence Platform’s Q1 2021 earnings previews for the biggest tech and media companies. For a complete list of the companies VIP has analyzed in advance of the Q1 earnings season, read our most recently published special report, “Q1 Preview: 2021 Financial Outlook for Key Media & Tech Companies.” 

Read the full special report