What to Look for When Apple, Alphabet and Netflix Report Soon

It’s that time of the quarter again, when thousands of companies use lengthy press releases to disclose just how their businesses fared over the prior three months and along the way share a few things (some companies more so than others) about what they expect conditions to look like in the coming months.

For tech firms, this earnings season arrives on the heels of an 11-month rally during which the Nasdaq has gained over 30% and many high-flyers have tacked on 50% or more. The bar is often being set high for big-name tech companies due to report. But then again, the same could’ve been said in mid-July, when the Nasdaq was trading about 200 points lower.

Here are some things to keep an eye on as three marquee tech names — specifically, Netflix Inc. (NFLX) , Apple Inc.  (AAPL) and Alphabet Inc. (GOOGL) — report in the coming weeks.

Netflix

Netflix, whose Q3 shareholder letter arrives on the afternoon of Oct. 16, is the first big tech name to report this month. The consensus is for revenue of $2.97 billion (up 30%) and GAAP EPS of $0.32. But Netflix’s subscriber adds typically have a much bigger impact on how its stock reacts post-earnings. In July, the company guided for 750,000 Q3 U.S. streaming subscriber adds and 3.65 million international adds. What to watch:

  • Asian momentum. Though now available in just about every big foreign market besides China, the company only launched its services in large Asian markets such as Japan, India and South Korea in late 2015 or early 2016. Growing penetration rates for these markets is crucial to maintaining Netflix’s heady international subscriber growth, which to date has depended a lot on Europe and (to a lesser extent) Latin America.

    Netflix doesn’t break out international subscriber adds by region, but does at times provide some color on how it’s faring in various locales. The company has been stepping up its local content investments for Asian audiences, and said on its Q2 call it would invest…

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