Unpacking Q3 Earnings: Netflix (NASDAQ:NFLX) In The Context Of Other Consumer Subscription Stocks

Looking back on consumer subscription stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Netflix (NASDAQ:NFLX) and its peers.

Consumers today expect goods and services to be hyper-personalized and on demand. Whether it be what music they listen to, what movie they watch, or even finding a date, online consumer businesses are expected to delight their customers with simple user interfaces that magically fulfill demand. Subscription models have further increased usage and stickiness of many online consumer services.

The 8 consumer subscription stocks we track reported a mixed Q3. As a group, revenues beat analysts’ consensus estimates by 1.4% while next quarter’s revenue guidance was 2.2% below.

In light of this news, share prices of the companies have held steady as they are up 3.5% on average since the latest earnings results.

Netflix (NASDAQ:NFLX)

Netflix reported revenues of $9.82 billion, up 15% year on year. This print exceeded analysts’ expectations by 0.6%. Overall, it was a very strong quarter for the company with EPS guidance for next quarter exceeding analysts’ expectations and an impressive beat of analysts’ EBITDA estimates.

Interestingly, the stock is up 36.3% since reporting and currently trades at $936.91.

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Best Q3: Duolingo (NASDAQ:DUOL)

Duolingo reported revenues of $192.6 million, up 39.9% year on year, outperforming analysts’ expectations by 1.8%. The business had a very strong quarter with an impressive beat of analysts’ EBITDA estimates and full-year EBITDA guidance exceeding analysts’ expectations.

Duolingo pulled off the fastest revenue growth and highest full-year guidance raise among its peers. The company reported 113.1 million users, up 36.1% year on year. The market seems happy with the results as the stock is up 6.6% since reporting. It currently trades at $340.

Weakest Q3: Chegg (NYSE:CHGG)

Chegg reported revenues of $136.6 million, down 13.5% year on year, exceeding analysts’ expectations by 1.9%. Still, it was a slower quarter as it posted a decline in its users.

Chegg delivered the slowest revenue growth in the group. The company reported 3.83 million users, down 12.9% year on year. As expected, the stock is down 9.5% since the results and currently trades at $1.61.

Udemy (NASDAQ:UDMY)

Udemy reported revenues of $195.4 million, up 5.8% year on year. This number topped analysts’ expectations by 1.4%. More broadly, it was a mixed quarter as it also produced a solid beat of analysts’ EBITDA estimates but number of monthly active buyers in line with analysts’ estimates.

The company reported 16,848 active buyers, up 9.6% year on year. The stock is down 5.7% since reporting and currently trades at $7.98.

Match Group (NASDAQ:MTCH)

Match Group reported revenues of $895.5 million, up 1.6% year on year. This print came in 0.6% below analysts' expectations. It was a slower quarter as it also logged revenue guidance for next quarter missing analysts’ expectations significantly and a decline in its users.

Match Group had the weakest performance against analyst estimates among its peers. The company reported 15.21 million users, down 3.2% year on year. The stock is down 12% since reporting and currently trades at $33.27.

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This content was originally published on Stock Story