At our offices, we've been chattering about the giant Disney Plus (opens in new tab)-branded meteorite headed straight for the entire streaming media landscape. It seems as if Netflix (opens in new tab) is just shrugging it off, or at least wants to give that impression to stockholders.
In a note (opens in new tab) included with the company's third-quarter earnings report, sent yesterday (Oct. 16), Netflix said that incoming competitors "have some great titles (especially catalog titles),” before undercutting that with the statement that “none have the variety, diversity and quality of new original programming that we are producing around the world."
Netflix did admit, however that it does anticipate some early forces working against it, citing "The launch of these new services" creating "modest headwind to our near-term growth, and we have tried to factor that into our guidance."
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The note wasn't lacking in confidence, though, stating "We did well during the first decade of streaming. We’ve been preparing for this new wave of competition for a long time. It’s why we started investing in originals in 2012 and expanded aggressively ever since - across programming categories and countries with an ambition to share stories from the world to the world."
Netflix then cites The Crown, The Witcher and The Irishman in a list of reasons people will stick with the company.
We'll see how much Netflix's confidence in its content holds up with potential and existing subscribers, though it may have a point about variety, especially when it comes to Disney Plus. As a potential subscriber, I look at the house of the mouse and see a lot of wholesome content, with The Mandalorian (opens in new tab) being the sole program that might be close to what I would watch on an HBO or Netflix.
Following that announcement, the Netflix stock jumped by 17.99 points from yesterday to this morning, which is about 6% of its value. A ~3 point dip followed, which might be related to how Netflix's subscriber gains failed to meet analyst projections, for the second consecutive quarter, adding 6.7 million, missing an prediction of 7 million new subs.
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