Netflix Expects Ads to Be a Major Catalyst
Based on the stock's move higher on Friday, Netflix's (NASDAQ: NFLX) fourth-quarter report impressed investors. While some key metrics for the period came in better than expected for the period, it may be management's outlook that is driving excitement for the stock on Wall Street. Netflix is optimistic about 2023, the quarterly update revealed. To sum up management's expectations, the streaming service specialist believes there is now a clear path to reaccelerating its revenue growth rate.
While there are a number of drivers the company anticipates helping drive its growth going forward, one key catalyst management referred to several times in its Q4 letter and earnings call was its nascent advertising business. Management expects this to morph into a major driver for the company.
Launching its long-awaited, ad-supported tier in November, Netflix's new revenue stream is just a few months old. But a few months of history was enough for management to start forming some early estimates for how the business could perform.
Source Fool.com
