5 big earnings reports: Netflix jumps on subscriber beat

By Davit Kirakosyan

Investing.com -- Among the biggest earnings reports yesterday, Netflix subscriber numbers came in well ahead of estimates. Here's the full list, as covered in real time on InvestingPro. Sign up to get this news first.

Netflix climbs following Q4 report

Netflix (NASDAQ:NFLX) said fourth quarter global streaming paid net additions grew 7.66 million, well ahead of its 4.5M estimate, due to both strong acquisition and retention, and driven primarily by the success of its Q4 content slate. EPS came in at $0.12, compared with the consensus estimate of $0.59, while revenue was $7.85B (up 2% year-over-year), just above consensus.

For Q1, the company expects revenue of $8.172B (up 4% year-over-year), better than the $8.15B consensus, though expected EPS of $2.82 is lower than the $2.97 average estimate. The company expects to roll out paid sharing more broadly later in Q1, anticipating it to result in a very different quarterly paid net adds pattern in 2023, with paid net adds likely to be greater in Q2 than in Q1.

Netflix also announced that Reed Hastings stepped down as a co-CEO to take on the role of executive chairman. Former COO Greg Peters is now Ted Sarandos' co-CEO and a member of the Netflix board.

Shares were recently up more than 5% pre-market.

Procter & Gamble sales hit by strong U.S. dollar

Procter & Gamble (NYSE:PG) shares closed down more than 2% after the company said Q2 sales dropped due to the strong U.S. dollar, which it says negatively impacted international demand for the company's consumer goods.

Net sales, which take into account foreign exchange and acquisitions, decreased by 1% from a year earlier to $20.8B in Q2. The company, which earns more than half of its revenue from outside the U.S., stated that an "unfavorable" foreign exchange environment had a 6% effect on net sales. Still, the number was slightly better than the consensus estimate of $20.74B. Q2 EPS came in at $1.59, compared with the consensus estimate of $1.58.

The company raised its fiscal 2023 all-in sales growth guidance to a range of (1%)-0% from the prior (3%)-(1%). The company maintained its 2023 diluted EPS growth guidance in the range of 0-4% versus fiscal 2022 EPS of $5.81.

Bad tidings at Nordstrom

Nordstrom (NYSE:JWN) was off some 6% in the pre-market after the company said sales dropped 3.5% for the nine-week holiday period ended December 31, 2022, compared with the nine weeks ended January 1, 2022. For the Nordstrom banner chain, net sales decreased 1.7 percent, while net sales at the Nordstrom off-price Rack chain decreased 7.6 percent.

Kohl's Corp. (NYSE:KSS) and Macy's, Inc. (NYSE:M) both lost ground on the news.

Rounding out yesterday's earnings news

WeWork Inc. (NYSE:WE) said yesterday it expects to report Q4 revenue above forecast and a narrower fall in EBITDA. It had forecasted revenue in the range of $870-890M and adjusted EBITDA in the range of minus $85-65M. The company also announced it plans to cut approximately 300 jobs in its global workforce. Shares closed down more than 3%.

Allstate (NYSE:ALL) shares plunged more than 5% following the company's reported preliminary Q4 results, estimating a net loss of $285-335M, with an adjusted estimated net loss of $335-385M.

Unfavorable prior-year reserve estimates totaled $282M, excluding catastrophes. According to BofA Securities, which cut its price target to $148 from $154, this is likely the most disappointing item from the pre-announcement. "Following a corrective prior-year charge of $875mn in 3Q22, investors and the Street were hoping to have the recent strengthening in the rearview mirror," the firm added.

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