Key Takeaways:
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• Stock up 90% in 2024, reaching $400B market cap
• NFL Christmas broadcasts drew record 24M+ viewers each
• Company to stop reporting subscriber numbers after Q4
• Trading at 39x forward earnings, premium to tech giants
What Happened?
Netflix has delivered an exceptional 2024 performance, marked by successful expansion into live sports, strong content releases, and effective password-sharing crackdown. The company’s Christmas Day NFL broadcasts broke streaming records, while new content like Squid Game’s second season and deals for women’s World Cup rights demonstrate continued momentum. The stock has surged approximately 90%, its best performance since 2015, pushing market capitalization to nearly $400 billion.
Why It Matters?
This transformation represents Netflix’s evolution from pure streaming platform to comprehensive entertainment powerhouse. The company’s success in live sports and premium content validates its strategy while widening the gap with competitors. However, the stock’s premium valuation (39x forward earnings) exceeds both media peers and tech giants, setting high expectations for future growth. The decision to stop reporting subscriber numbers signals a strategic shift toward focusing on revenue and profitability metrics.
What’s Next?
Key factors to monitor include:
- Q4 earnings report (January 21) – expected 9M new subscribers
- Execution of sports broadcasting strategy
- Revenue growth through pricing and advertising
- Market reaction to new metrics after subscriber reporting ends
- Sustainability of premium valuation
- Competition response and industry consolidation
The company’s ability to maintain growth while transitioning to new success metrics will be crucial for justifying its premium valuation and market leadership position.
