Analyst Note| Neil Macker, CFA |
Netflix reported a mixed second quarter as subscriber growth remains anemic due to the pull forward in demand during the first half of 2020. Subscriber additions were well ahead of guidance, but revenue was in line with our projections for the quarter. While management expects adds to accelerate to 3.5 million next quarter, this mark is well behind our previous expectation of 6.9 million. We think the firm is experiencing not only saturation in its largest markets but also strong competition in the regions with the most potential growth, as we previously expected, and continue to expect. As a result, we keep our narrow moat and $250 FVE.