Seeing Green: Reading the Streaming Tea Leaves from Q2 Earnings

Updated 08/12/2024 | Matchpoint Connect

ARTICLE UPDATED 08/12/2024
Matchpoint Connect

By Max Newfield | September 2, 2024

The average American likely thinks of the dog days of summer as a time for beach days and fireworks shows but it’s earnings season for those of us in the streaming industry.

Over the last few weeks, some of the country’s biggest streamers have announced their earnings results. While some companies are experiencing headwinds, we all have plenty of reasons to be excited about this moment in streaming media.

The good news for the industry is that Americans have not abandoned their streaming devices for their favorite pool deck or national park (or if they did leave the house, they get exceptional service out in the woods).

In June, streaming platforms accounted for more than 40% of all TV use for the first time ever according to Nielsen. Likewise, broadcast and cable television combined for just 47.7% of television usage, the lowest mark since Nielsen began tracking these sorts of things.

So who is capitalizing on this watershed moment in streaming? What strategies are working and who needs to hit the pause button? And what do you need to do to scale your content business like the rest of the streaming landscape? Read on to find out.

Ready to save money and achieve scale faster? Find out how Matchpoint can get your streaming content ready in minutes, not months.

Netflix

No surprise here but the original name in streaming still continues to dominate the TV screens across the country.

According to the previously mentioned Nielsen report, Netflix broke into the top four of all US distributors in terms of share of TV use. Not too shabby when you consider that the top three includes two of the oldest and largest TV broadcasters (Disney and NBCUniversal) and the most popular free-to-use social video site on earth (YouTube).

The Netflix accounting department also had good news to share as the company makes its push for AVOD memberships. Revenue is up 17% amid a 34% rise in ad-supported memberships.

Considering that the company is ramping up its live programming and even building its own in-house ad technology platform, expect advertising to drive even more of Netflix’s bottom line in the very near future.

Peacock

In most cases, we wouldn’t report a $348M loss as a good thing. But in NBCUniversal’s case, the company cut Peacock’s losses nearly in half from this time a year ago, while pushing revenue up over $1B for the best quarter since it launched in 2020.

What’s more is that Peacock also has the Summer Olympics and a price increase on deck for the beginning of Q3. Parent company Comcast also rolled out the StreamSaver bundle, which provides Xfinity customers discounted access to Peacock, Netflix, and Apple TV+. While there aren’t any financial results to share on StreamSaver, one executive told StreamTV Insider that the bundle was “Strong out of the gate.”

Might this be a turning point for the beleaguered Peacock? Who’s to say. But a collective 17 billion minutes of Olympics view time and rave reviews for the Peacock service likely bodes well for NBCUniversal.

Disney

A quick scan of Disney earnings headlines might indicate a mixed bag of results but everyone on the entertainment side of the conglomerate is probably feeling pretty great.

On Wednesday, the House of Mouse announced their combined streaming services–Disney+, Hulu, and ESPN+–turned a profit for the first time. Combine that with a recent victory in the fight for NBA media rights plus Inside Out 2 becoming one of the highest grossing movies of all time and it’s safe to assume a few champagne corks might have flown in Burbank this week.

So how is Disney building on their recent success? By doubling down on what drives positive bottom line results. The company recently announceda modest price hike across most plans as well as new features catered toward young children.

Let this be a lesson to us all. Don’t overthink your streaming strategy. Sometimes you’ve just got to play the hits.

Warner Bros. Discovery

Believe it or not, Warner. Bros. Discovery is having a fairly similar week to Disney. Stocks fell after the company announceda $9B write-down on its linear TV business but, once again, streaming was a bright spot on the earnings call.

WBD added3.6 million subscribers in Q2, bringing their total number of subscribers well over 100 million across all services.

In the face of a legal battle over NBA rights, and those previously mentioned TV struggles, WBD representatives saidit is “imperative” to show growth in the DTC business.

The good news for David Zaslav and the rest of Warner Bros. Discovery? There’s never been a better time to scale your streaming business. Check out last week’s Matchpoint Spark blogto learn more about how to meet this history moment in streaming.

Ready to share some good news on your next earnings call? Want to scale your streaming business while saving money? Matchpoint can help. Find out more here.

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