How Netflix Profits From Corona Pandemic

Watching Netflix

Streaming boom, stock at record high: Netflix is among the big winners in the Corona downtime. On the stock market, the online video service has even overtaken the Hollywood giant Disney. Can the latest quarterly figures justify the hype?

The Corona crisis is crippling the global economy and keeping the financial markets on tenterhooks. But while many US companies are closing down shops or factories and taking leave or laying off employees, the standstill is playing into the hands of others. Netflix is one such case – the online video service benefits like few other companies from the fact that many people around the world stay at home. In addition, the streaming market leader has recently landed a big viral hit with the documentary series “Tiger King”.

Founded in 1997 in Los Gatos, California, the group is on one of the biggest waves of success in its history. On the stock exchange, Netflix shares have already risen by over 36 percent this year – despite a general fall in prices – and have recently broken new records. With a stock market value of almost 195 billion dollars, even the US entertainment giant Walt Disney, which was worth twice as much as Netflix in the winter, was overtaken.

Netflix plans to present its results for the first quarter on Tuesday after the US stock exchange closes (22:00 CEST). The corona pandemic should ensure strong figures. Netflix is already the undisputed king of streaming: even before the virus spread, the service had 167 million subscribers and was already keeping people around the globe in their homes. From the beginning of January until the end of March, Netflix was committed to adding seven million more subscribers.

While the impact of the pandemic has only really hit most parts of the world – and the important U.S. domestic market – last month, the service has been able to gain a significant share of the market. Nevertheless, experts expect Netflix to easily exceed its growth targets. The “stay-at-home” era caused by the virus outbreak should ensure that Netflix further extends its lead in the streaming market, says Credit Suisse analyst Brian Russo. The competition is not yet global enough to benefit from the trend to the same extent.

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