🍿 Netflix’s sub-prise

Friday, January 20, 2023 by Robinhood Snacks |
Wednesdays are for streaming (Michael Tullberg/Getty Images)

Wednesdays are for streaming (Michael Tullberg/Getty Images)

Wednesdays are for streaming (Michael Tullberg/Getty Images)

Wednesdays are for streaming (Michael Tullberg/Getty Images)

Yesterday’s Market Moves
Dow Jones
33,045 (-0.76%)
S&P 500
3,899 (-0.76%)
10,852 (-0.96%)
$21,067 (+1.90%)

Hey Snackers,

An unlikely source of home decor: Twitter had a fire sale of hundreds of items including conference tables, planters, and espresso machines from its San Francisco office. Oh, and a statue of Twitter’s bird logo sold for $100K.

Stocks fell for the third straight day after jobless claims dropped to their lowest level since September. Low unemployment is good but could have negative side effects: investors worry the steady job market means the Fed may keep hiking rates even as inflation slows.


Autoplaying the next episode… just one more. Netflix shares surged 7% after the bell yesterday after it announced a subscription shocker: millions more subs than expected. The streaming OG added 7.7M paid subscribers last quarter — way better than the 4.5M forecast — as folks signed up to binge faves like “Emily in Paris.”

  • Top quarterly hits: “Wednesday” was Netflix’s third most popular series ever, while “Harry & Meghan” was its second most popular docuseries. “Glass Onion” got big views too.

  • Major plot twist: Netflix announced that its founder and longtime leader, Reed Hastings, would be stepping down from his position as co-CEO.

  • Anticlimax: Netflix experienced its slowest quarterly revenue growth of all time (sales up less than 2% from last year) and badly missed on profit expectations (think: $55M compared to $1.4B the previous quarter).

When the ad hits on a cliffhanger… This was Netflix’s first quarter that included revenue from its $7/month ad-supported offering, which launched in November. But the word “ads” was mentioned just three times in its earnings report (“advertising” got four mentions). Still, Netflix said it was “pleased with the early results, with still much more to do.” Analysts say they haven’t seen much demand for the cheaper ad tier, which accounted for only 9% of November sign-ups.


Netflix’s one-number era could be over… Despite disappointing earnings and sluggish revenue growth, investors boosted Netflix stock after hearing its headline subscriber number — which has historically been the focus. But going forward Netflix says it will no longer give subscriber forecasts as it prioritizes revenue growth in this saturated streaming market. Ads are part of the new strategy. Netflix is also launching paid sharing to crack down (and profit from) password mooching.


Dustin Johnson heads to “Riverdale”… LIV Golf (finally) has a TV partner. Yesterday the Saudi-backed golf tour sealed a multiyear broadcast deal with the CW network. You might remember the CW for cult-fave teen dramas like “Gossip Girl” and “Vampire Diaries.” Starting next month, LIV will air 14 events on CW’s weekend broadcast and on its app. Before, you could stream LIV only online (think: YouTube).

  • Teed up: LIV has caused a stir since its debut last year. It spent billions to poach several top players and host flashy golf tournaments that look more like music festivals.

  • Gloves on: LIV is in a heated legal dispute with US rival PGA Tour (LIV accused the legacy golf group of monopolizing the sport).

Scrambling for screen time… LIV has struggled to secure key revenue streams like TV rights and sponsors. It’s burning cash, courtesy of billions in Saudi backing. Legacy sports broadcasters like CBS, Comcast’s NBC, and Disney’s ESPN have avoided working with LIV, because they also stream PGA events. The PGA earns about $600M/year through broadcast deals, and that revenue covers more than half its tournament purses.


Home is where the eyeballs are… and for LIV network TV could mean millions more viewers. CW is not the go-to broadcaster for golf, but its youthful audience and well-known brand could help LIV reel in old fans and fresh faces. And for CW, LIV’s top-tier players could attract new audiences. In a best-case scenario, LIV could earn up to $410M in broadcast rights by 2028 — but it’ll have to settle its PGA beef first.

What else we’re Snackin’

  • Ceiling: The US hit its $31.4T debt limit yesterday, risking a scenario where the govt can’t pay its bills. Now the Treasury plans to use “extraordinary maneuvers” to prevent a default.

  • Wipe: Procter & Gamble’s revenue and profits fell as shoppers cut back on name-brand products like Tide, Charmin, and Crest. P&G’s price hikes didn’t manage to offset slowing sales.

  • Fruity: Food-tech company Evigence raised $18M for its sticker-sized smart sensor that shows the freshness of food in real time. FYI: “imperfect” (but still fresh) produce makes up nearly half of all food waste.

  • Shut: Amazon is discontinuing its charity-donation program, which has given away $450M since 2013, in its latest effort to cut costs. Amazon has laid off thousands of workers as sales slow.

  • Rack: Nordstrom shares fell 6.5% after the mall staple posted weak holiday sales and took a hit from hefty markdowns. The retailer slashed its guidance as Americans cut back on material splurges.

Snack Fact of the Day

The richest 1% amassed nearly two-thirds of the new wealth created globally in the past two years


  • Earnings expected from Ericsson, Ally Financial, and State Street

Authors of this Snacks own shares: of Amazon, Disney and Google

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