Episode summary
Daybreak Weekend: Neflix Earnings, Hungary Election, Spain Prime Minister Visits China |...
Bloomberg Daybreak: US Edition
· · 38 min · Hosts: Nathan Hager
Summary
Netflix is positioned to report after the market close on Thursday, and Bloomberg Intelligence’s Geetha Ranganathan argued that the collapse of the Warner Brothers Discovery deal actually leaves the streamer in a better spot. She said Netflix is now a “cleaner” business with more flexibility, and that investors will focus on revenue growth and operating margins. She expects the company to raise its full-year revenue growth guide from 12% to 14% and to lift its margin outlook, while seeing little evidence that recent price increases will meaningfully increase churn.
The banks segment centered on JPMorgan Chase, Wells Fargo, and Citigroup, which report Tuesday. Herman Chan said the group enters earnings with macro worries around geopolitics, stagflation, and private credit, but underlying fundamentals still look strong. He pointed to expected 15% growth in JPMorgan trading revenue and investment banking, balance-sheet growth for Wells Fargo now that it is outside the asset cap, and questions for Citigroup about whether M&A or a regional bank purchase is realistic in the near term.
The program also looked ahead to Hungary’s election and Pedro Sánchez’s trip to China. Bloomberg’s Europe team framed Hungary as a test of Viktor Orbán’s 16-year rule against Peter Magyar’s anti-corruption challenge, while Sánchez’s visit was presented as a bid to deepen investment ties with China, especially in autos and renewables, even as it risks friction with the US and some EU partners.
Key takeaways
- Geetha Ranganathan said Netflix should benefit from being a "cleaner, higher visibility business" after the Warner Brothers deal fell apart.
- Ranganathan expects Netflix to lift its full-year revenue growth guide above 12% to 14% and improve operating-margin guidance.
- Herman Chan said JPMorgan could post 15% growth in trading revenue and investment banking in the first quarter.
- Chan said Wells Fargo should show more balance-sheet growth now that it is outside the asset cap.
- Chan said Citigroup’s near-term regional-bank M&A looks unlikely unless the company improves its valuation first.
- The Hungary segment framed Peter Magyar as a serious challenger because voters are focused on recession, corruption, and living costs more than Orbán’s foreign-policy message.
Notable quotes
“This is actually good news for Netflix, right? And this is back to business as usual”
“We expect them to revise that guidance upwards, and then also kind of revise their guidance for operating margins”
“We're in an interesting setup heading into earnings with heightened geopolitical concerns, stagflation potential, private credit worries”
“Spain is really keen to get more significant Chinese investment”
How the episode opens
Bloomberg Audio Studios. Podcasts, radio, news. This is Bloomberg Daybreak weekend, our global look at the top stories in the coming week from our Daybreak anchors all around the world.
Straight ahead on the program, we look to earnings from streaming giant Netflix and three of Wall Street's biggest banks. I'm Nathan Hager in Washington. I'm Caroline Hepker in London, where we discuss the Hungarian election.
I'm Doug Krizner looking at the visit to China by Spanish Prime Minister Pedro Sanchez. That's all straight ahead on Bloomberg Daybreak weekend on Bloomberg 1130 New York, Bloomberg 99.1 Washington D.C., Bloomberg 92.9 Boston, DAB digital radio London, Sirius XM 121, and around the world on bloombergradio.com and the Bloomberg Business app. Good day to you.
I'm Nathan Hager. We begin today's program with earnings from Netflix. The streaming giant reports its latest quarterly results after the market close on Thursday.
For more, we're joined by Bloomberg Intelligence senior media analyst Geetha Ranganathan. A great to have you with us, Geetha. Of course, this was supposed to be the quarter when Netflix celebrated locking in its deal to buy Warner Brothers Discovery, but Paramount Sky Dance pulled the rug out from under that.
What's that mean for what we could hear from Netflix when it comes to the results this week? Yeah, thank you so much, Nathan. This is actually good news for Netflix, right?
And this is back to business as usual. Netflix without Warner Brothers is a much cleaner, higher visibility business, lower volatility business. They have much better financial standing now.
They have a lot more flexibility. And you know, this is really now us just on their fundamentals, both their short-term as well as their long-term fundamentals as they kind of really focus on content, as they focus on engagement.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- netflix earnings
- bank stocks
- hungary election
- spain china trip
- week ahead market outlook
Companies and tickers mentioned
- NFLX
- Netflix
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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