Netflix Faces Concerns About Ad Subscription Plan and Pricing Strategy

Investors are eagerly awaiting updates from Netflix regarding the progress of its ad subscription plan and pricing strategy. These anticipated announcements are expected to take place after the market closes. However, some analysts are expressing concerns that changes in these areas could potentially hinder future growth for the streaming giant.

In terms of the third quarter, analysts have reached a consensus on Netflix's expected financial performance. The company is projected to report revenue of $8.54 billion, earnings per share of $3.49, and an increase of 6.1 million paid net-add subscriptions. Looking ahead to the current quarter, analysts estimate earnings per share of $2.17, net additions of 7.7 million, and revenue reaching $8.78 billion.

Wolfe analyst Peter Supino recently downgraded Netflix from an "Outperform" rating to "Peer Perform" and removed his previous price target of $500 for the stock. He cited concerns about the company's growth in the coming years as the catalyst for this decision.

As a result of these concerns and uncertainties, Netflix shares have fallen by 21% over the past three months. In September, investors were disappointed by what they interpreted as cautious remarks from a company executive regarding profitability and growth.

It remains to be seen how Netflix will address these challenges and navigate its advertising efforts moving forward. Investors will be closely watching for any updates from the company to gain more clarity on its future prospects.