Netflix stock down 25% - GoFuckYourself.com

Barefootsies · 07-26-2012, 09:52 AM

Ouch.

Quote:

Netflix?s managers and investors clearly aren?t seeing eye-to-eye regarding the future of the company.

A day after the streaming video service announced its intention to venture back into red ink in order to pursue some ?once in a lifetime? foreign expansion opportunities, Wall Street hammered the company ? hard ? dropping its stock price by 25 percent on the Nasdaq Wednesday (see Yahoo stock graphic below).

This followed a price decline of nearly 14 percent in after-hours trading Tuesday, coinciding with Netflix?s late-afternoon second-quarter earnings report.
Also read: Netflix Q2 ? Hits revenue target but misses on subscribers
The stock finished the day trading at $60.28 a share ? a level not seen since January 2010.

That?s bad news for a company that reported a 13 percent revenue uptick to $889.2 million, while returning to the black with a narrow profit of $6 million, or 11 cents per share.

Is this really about subscribers?

On Tuesday, Netflix CEO Reed Hastings and CFO David Wells conceded to investors that the company will be challenged to meet its stated goal of growing its streaming subscriber base by 7 million by the end of 2012.

Also read: Netflix to investors ? ?We?re taking our profits to Europe!?
It?s hard to imagine investors were surprised by this. On April 23, they dropped the stock by 16 percent in after-hours trading after Netflix announced that it had added 3 million subscribers in first quarter but would probably come up a bit light in Q2.

And come up light it did, but not unexpectedly so. The 1.1 million streaming customers added on a global basis was probably short of investor hopes, but it fell in line with Netflix?s guidance.

Beyond subscribers, Netflix?s admission that it won?t stay in the black the rest of the year as it ramps up foreign expansion into Western Europe ? and as it continues to seek a beach head in Latin America ? likely didn?t please investors.

With profits down 91 percent year over year, Hastings and Wells told investors Tuesday to expect red ink in the fourth quarter.

?Our model is to get back to profitability and then open a new market, get back to profitability, open a new market,? Hastings said.

Noted Wedbush Securities? Michael Pachter, who maintained his ?underperform? rating on Netflix?s stock: ?We expect Netflix to operate at roughly break-even until it has completed its international land grab later this decade.?

In his own report, awkwardly titled ?Aggressive international expansion plans expected to hurt 2013 profitability more than expected,? Sterne Agee analyst Arvind Bhatia added, ?We are lowering our 2012/2013 revenue estimates slightly to $3.6 billion/$4.16 billion from $3.67 billion/$4.3 billion respectively. More importantly, we are reducing our 2013 [earnings per share] estimate significantly to $0.40 from $2.12 given the company?s indication it will continue to plough back any domestic profits into further international expansion.?

SOURCE

BIGTYMER · 07-26-2012, 09:54 AM

They can bash it all they want but I love it!

Not gonna buy their stock though.

GAMEFINEST · 07-26-2012, 09:58 AM

Not a good buy at the moment.

PR_Glen · 07-26-2012, 11:04 AM

i saw this, but this stock has been like a roller coaster since day one. trying to ride it is damn near impossible.

CaptainHowdy · 07-26-2012, 11:08 AM

That's the rush of the stock market, isn't it??

brassmonkey · 07-26-2012, 11:09 AM

they still have members?? wow

Verbal · 07-26-2012, 11:15 AM

When there's blood in the streets ...

Relentless · 07-26-2012, 11:19 AM

They had short term content agreements from many major content producers at absurdly low prices and built their business model off that. Now the major content companies have their own alternatives (like Hulu) or understand the value of their digital content rights well enough to demand price increases of 100s of times their former deal values. The massive expense increases from content providers and simultaneous demand for cheap or free monthly content from subscribers will eventually kill their business completely.

CourtneyR · 07-26-2012, 11:32 AM

they never have anything good to watch anyways.

Relentless · 07-26-2012, 11:48 AM

Quote:

Originally Posted by CourtneyR_FFN

they never have anything good to watch anyways.

They will gradually have less and less and they lose more content producers.

bronco67 · 07-26-2012, 11:58 AM

I thought they were going down the shitter a year ago, that's why I dumped the service. Every time I went to the site looking to watch something specific, there was a 90% chance it wasn't on Instant streaming.

kane · 07-26-2012, 12:06 PM

I think eventually sites like Netflix, Hulu, Amazon Prime and Blockbuster will all be pretty much the same and offering the same content. Right now what sets them all apart is the content they offer (as well as layout, design etc.). The reason for that is that content producers are striking deals to have their stuff exclusively on one service or another. I think eventually that trend will end because the producers will realize that people don't want to have 2, 3, or 4 memberships to different sites just to see the content they want. They will realize that they might make more money if they licensed to all sites instead of making a single exclusive deal.

Ross · 07-26-2012, 12:07 PM

I'm close to cancelling my subscription. Everything I watch lately is either out of sync or the sound is absolutely horrible. I have a Bose surround system that is out of this world but when watching a movie on Netflix some parts of movies the sound is going down then at others its too loud. Before anyone says shit, it's not my surround sound, it works perfectly well with everything else.

brassmonkey · 07-26-2012, 12:12 PM

head over to amazon

CyberHustler · 07-26-2012, 12:13 PM

PR_Glen · 07-26-2012, 12:39 PM

Quote:

Originally Posted by Ross

I'm close to cancelling my subscription. Everything I watch lately is either out of sync or the sound is absolutely horrible. I have a Bose surround system that is out of this world but when watching a movie on Netflix some parts of movies the sound is going down then at others its too loud. Before anyone says shit, it's not my surround sound, it works perfectly well with everything else.

told you it wouldn't work..

scuba steve · 07-26-2012, 12:47 PM

Quote:

Originally Posted by Ross

I'm close to cancelling my subscription. Everything I watch lately is either out of sync or the sound is absolutely horrible. I have a Bose surround system that is out of this world but when watching a movie on Netflix some parts of movies the sound is going down then at others its too loud. Before anyone says shit, it's not my surround sound, it works perfectly well with everything else.

your internet connection? i know you live in bfe canada

ShoeBox · 07-26-2012, 12:48 PM

netflix sucks , they never update there content

shinmusashi44 · 07-26-2012, 01:51 PM

Quote:

Originally Posted by Ross

I'm close to cancelling my subscription. Everything I watch lately is either out of sync or the sound is absolutely horrible. I have a Bose surround system that is out of this world but when watching a movie on Netflix some parts of movies the sound is going down then at others its too loud. Before anyone says shit, it's not my surround sound, it works perfectly well with everything else.

A lot of people have this problem, myself as well, just search the net for it. The voices are always so damn low but everything else is loud. But dvds and everything else plays fine.

GetSCORECash · 07-26-2012, 02:01 PM

Quote:

Originally Posted by BIGTYMER

Not gonna buy their stock though.

Who wants to buy a stock that is so leverage?

I'm with you BIGTYMER, NetFlix is just fine, if they don't have something I don't want I'll go to Hulu, if neither of them have what I want, I've wasted to much time watching TV.

I just got an Antenna to watch the Olympics.

mikesouth · 07-26-2012, 02:24 PM

I like Netflix and Hulu I love the idea and eventually it will be more the m=norm than having cableTV

The problem with Netflix is at first its great but then you see all the documentaries and stuff and the serious lack of anything even close to a new release and it just isnt worth it anymore. If Netflix is going to grow they are going to have to put some serious money into new release and even exclusive stuff...Like when HBO used to show movies a few months before showtime, Cinemax or TMC got them....

The model is timely...the content...not so much

looky_lou · 07-26-2012, 02:27 PM

I am sure that the stock went down because of me. I just signed up last night. Watched a couple of good movies.

kane · 07-26-2012, 04:54 PM

Quote:

Originally Posted by mikesouth

I like Netflix and Hulu I love the idea and eventually it will be more the m=norm than having cableTV

The problem with Netflix is at first its great but then you see all the documentaries and stuff and the serious lack of anything even close to a new release and it just isnt worth it anymore. If Netflix is going to grow they are going to have to put some serious money into new release and even exclusive stuff...Like when HBO used to show movies a few months before showtime, Cinemax or TMC got them....

The model is timely...the content...not so much

I did a little experiment about 9 months ago. I called and canceled cable and just used my computer to for TV entertainment. The few shows that I watch post the full episodes on their website within 24 hours of airing them. Between the streaming and DVD service of Netflix I had plenty to watch if I was in the mood that kind of thing.

It took a week or two to get used to it, but then it was cool and I didn't really miss the TV. I ended up getting it back so I could watch Game of Thrones on HBO and baseball season started so I want to watch games, but after the season is over I will likely shut it off again.

I don't think we are too far from cable being something that a person really no longer needs.

Ron Bennett · 07-26-2012, 08:35 PM

Main problem with Netflix is U.S. copyright law...

Physical DVDs can be rented to others without any interference. However, copyright-holders can restrict / charge royalties for content that's digitally delivered.

Most people don't truly understand how dire the situation is for Netflix - which is made worse by Netflix itself waffling on the issue, since they don't want to upset the copyright-holders for whom they depend on for much of their streamed content.

From my understanding, Netflix licensing costs are skyrocketing, as in 10x to even upwards of 100x what they were previous paying - and to make matters worse, some content isn't even being offered to Netflix at any price.

Also, Netflix financially is very limited compared to Amazon, Google, Microsoft, etc who have a lot of available cash to spend on licensing, as well as leverage.

In short, Netflix is a 1-1/2 trick pony - dvd rentals, which is rapidly fading (old Netflix), and streaming which is growing in popularity (current Netflix), but their licensing costs are growing far faster eating into potential profits; limiting growth opportunities.

mce · 07-26-2012, 08:56 PM

It's all about staying ahead of technology and changing customer tastes....

bronco67 · 07-26-2012, 09:00 PM

Does anyone still go to a real video store, if you could find one? There's one near my house, and I skip Redbox sometimes to rent movies the old fashioned way. I look at the case first and go, "this looks pretty good. I think I'll rent it".

Chosen · 07-26-2012, 09:20 PM

I don't give a fuck...

kane · 07-26-2012, 10:06 PM

Quote:

Originally Posted by bronco67

Does anyone still go to a real video store, if you could find one? There's one near my house, and I skip Redbox sometimes to rent movies the old fashioned way. I look at the case first and go, "this looks pretty good. I think I'll rent it".

My town once had a Hollywood Video and a Blockbuster. Both have closed. The only real movie rental place now is about a half dozen Redbox kiosk in different stores.

07-26-2012, 09:58 AM	#3
GAMEFINEST Make STACK$ Industry Role: Join Date: Nov 2006 Location: sexy time Posts: 14,439	Not a good buy at the moment. __________________ Compound interest.

07-26-2012, 11:04 AM	#4
PR_Glen Confirmed User Industry Role: Join Date: Oct 2006 Location: Canada Posts: 9,058	i saw this, but this stock has been like a roller coaster since day one. trying to ride it is damn near impossible. __________________ webmaster at pimproll dot com

07-26-2012, 11:08 AM	#5
CaptainHowdy Too lazy to set a custom title Industry Role: Join Date: Dec 2004 Location: Happy in the dark. Posts: 93,664	That's the rush of the stock market, isn't it?? __________________ Vacares - Web Hosting, Domains, O365, Security & More - Paxum and BTC Accepted Windows VPS now available Great for TSS, Nifty Stats, remote work, virtual assistants, etc.

07-26-2012, 11:09 AM	#6
brassmonkey Pay It Forward Industry Role: Join Date: Sep 2005 Location: Yo Mama House Posts: 77,250	they still have members?? wow __________________ TRUMP 2025 KEKAW!!! - The Laken Riley Act Is Law! DACA ENDED - SUPPORT AZ HCR 2060 52R - email: brassballz-at-techie.com

07-26-2012, 11:19 AM	#8
Relentless www.EngineFood.com Industry Role: Join Date: Aug 2006 Posts: 5,697	They had short term content agreements from many major content producers at absurdly low prices and built their business model off that. Now the major content companies have their own alternatives (like Hulu) or understand the value of their digital content rights well enough to demand price increases of 100s of times their former deal values. The massive expense increases from content providers and simultaneous demand for cheap or free monthly content from subscribers will eventually kill their business completely. __________________ Website Secure \| Engine Food ICQ# 266-942-896

07-26-2012, 09:54 AM	#2
BIGTYMER Junior Achiever Industry Role: Join Date: Nov 2004 Location: Walled Garden Posts: 17,066	They can bash it all they want but I love it! Not gonna buy their stock though.

07-26-2012, 11:15 AM	#7
Verbal Confirmed User Join Date: Dec 2001 Location: Tampa, FL Posts: 3,420	When there's blood in the streets ...

07-26-2012, 11:32 AM	#9
CourtneyR Looking for traffic! Industry Role: Join Date: Jan 2012 Location: Santa Rosa, CA Posts: 2,942	they never have anything good to watch anyways. __________________ telegram: @courtneyrudolph \| HUGE Traffic \| Camsoda

07-26-2012, 11:58 AM	#11
bronco67 Too lazy to set a custom title Join Date: Dec 2006 Posts: 29,032	I thought they were going down the shitter a year ago, that's why I dumped the service. Every time I went to the site looking to watch something specific, there was a 90% chance it wasn't on Instant streaming. __________________

07-26-2012, 12:06 PM	#12
kane Too lazy to set a custom title Join Date: Aug 2001 Location: portland, OR Posts: 20,684	I think eventually sites like Netflix, Hulu, Amazon Prime and Blockbuster will all be pretty much the same and offering the same content. Right now what sets them all apart is the content they offer (as well as layout, design etc.). The reason for that is that content producers are striking deals to have their stuff exclusively on one service or another. I think eventually that trend will end because the producers will realize that people don't want to have 2, 3, or 4 memberships to different sites just to see the content they want. They will realize that they might make more money if they licensed to all sites instead of making a single exclusive deal.

07-26-2012, 12:07 PM	#13
Ross Ik ben een aap Industry Role: Join Date: Sep 2002 Location: Traffic Force Towers, Canada! Posts: 18,874	I'm close to cancelling my subscription. Everything I watch lately is either out of sync or the sound is absolutely horrible. I have a Bose surround system that is out of this world but when watching a movie on Netflix some parts of movies the sound is going down then at others its too loud. Before anyone says shit, it's not my surround sound, it works perfectly well with everything else.

07-26-2012, 12:12 PM	#14
brassmonkey Pay It Forward Industry Role: Join Date: Sep 2005 Location: Yo Mama House Posts: 77,250	head over to amazon __________________ TRUMP 2025 KEKAW!!! - The Laken Riley Act Is Law! DACA ENDED - SUPPORT AZ HCR 2060 52R - email: brassballz-at-techie.com

07-26-2012, 12:13 PM	#15
CyberHustler Masterbaiter Industry Role: Join Date: Feb 2006 Posts: 26,509

07-26-2012, 12:48 PM	#18
ShoeBox So Fucking Banned Industry Role: Join Date: May 2012 Location: Brazil Posts: 2,056	netflix sucks , they never update there content

07-26-2012, 02:24 PM	#21
mikesouth Confirmed User Industry Role: Join Date: Jun 2003 Location: My High Horse Posts: 6,334	I like Netflix and Hulu I love the idea and eventually it will be more the m=norm than having cableTV The problem with Netflix is at first its great but then you see all the documentaries and stuff and the serious lack of anything even close to a new release and it just isnt worth it anymore. If Netflix is going to grow they are going to have to put some serious money into new release and even exclusive stuff...Like when HBO used to show movies a few months before showtime, Cinemax or TMC got them.... The model is timely...the content...not so much __________________ Mike South It's No wonder I took up drugs and alcohol, it's the only way I could dumb myself down enough to cope with the morons in this biz.

07-26-2012, 02:27 PM	#22
looky_lou Confirmed User Industry Role: Join Date: Mar 2003 Location: Seattle, WA Posts: 1,771	I am sure that the stock went down because of me. I just signed up last night. Watched a couple of good movies. __________________ PUSSY - PUSSY - PUSSY! Wet & Puffy - Wet & Pissy - We Like To Suck Puffy Cash

07-26-2012, 08:35 PM	#24
Ron Bennett Confirmed User Join Date: Oct 2003 Posts: 1,653	Main problem with Netflix is U.S. copyright law... Physical DVDs can be rented to others without any interference. However, copyright-holders can restrict / charge royalties for content that's digitally delivered. Most people don't truly understand how dire the situation is for Netflix - which is made worse by Netflix itself waffling on the issue, since they don't want to upset the copyright-holders for whom they depend on for much of their streamed content. From my understanding, Netflix licensing costs are skyrocketing, as in 10x to even upwards of 100x what they were previous paying - and to make matters worse, some content isn't even being offered to Netflix at any price. Also, Netflix financially is very limited compared to Amazon, Google, Microsoft, etc who have a lot of available cash to spend on licensing, as well as leverage. In short, Netflix is a 1-1/2 trick pony - dvd rentals, which is rapidly fading (old Netflix), and streaming which is growing in popularity (current Netflix), but their licensing costs are growing far faster eating into potential profits; limiting growth opportunities. __________________ Domagon - Website Management and Domain Name Sales Last edited by Ron Bennett; 07-26-2012 at 08:36 PM..

07-26-2012, 08:56 PM	#25
mce Confirmed User Industry Role: Join Date: Jun 2012 Location: All Over Posts: 3,917	It's all about staying ahead of technology and changing customer tastes.... __________________ Pay Virtual Assistants Based on RESULTS instead of TIME STOP getting FUCKED IN THE ASS by your VA

07-26-2012, 09:00 PM	#26
bronco67 Too lazy to set a custom title Join Date: Dec 2006 Posts: 29,032	Does anyone still go to a real video store, if you could find one? There's one near my house, and I skip Redbox sometimes to rent movies the old fashioned way. I look at the case first and go, "this looks pretty good. I think I'll rent it". __________________ Last edited by bronco67; 07-26-2012 at 09:01 PM..

07-26-2012, 09:20 PM	#27
Chosen VIPPay.com \| AdultWebSponsors.com Industry Role: Join Date: Aug 2001 Posts: 63,151	I don't give a fuck...