Last month, Netflix Inc.
NFLX,
stock jumped after it reported big subscriber gains and hiked prices. Last week, results from Paramount Global
PARA,
beat expectations, sending shares of the streaming and entertainment giant on its best percentage gain in nearly a year, and Roku Inc.
ROKU,
also offered an upbeat outlook.
This week — as Walt Disney Co., Warner Bros. Discovery Inc., Lions Gate Entertainment Corp. and AMC Entertainment Holdings Inc. all report results — we’ll get a deeper sense of whether the entertainment industry is starting to make investors happy again, even if they make viewers less happy in the process.
Those companies will report as the streaming industry, under pressure from investors to turn a better profit, consolidates and as platforms charge more to watch and cram more advertisements into shows and films.
Cable TV providers and movie theaters, too, are trying to figure out a way forward as streaming becomes more prevalent. Even as Hollywood’s writers come back to work following a strike that shut down production, its actors are still striking, with issues surrounding AI usage to portray actors, streaming payments and other issues in the balance.
Disney
DIS,
which reports results on Wednesday, faces questions about losses at Disney+, efforts to cut billions in costs and stamp out streaming-account sharing, its planned takeover of the streaming platform Hulu and speculation over which of its large media properties it might sell. BofA analysts recently estimated that ESPN, which Disney has leaned on for years, could be worth around $24 billion. Meanwhile, activist investor Nelson Peltz has been angling for seats on Disney’s board, and its fight with Florida Gov. Ron DeSantis continues.
Elsewhere, Warner Bros. Discovery
WBD,
— the parent company of the streaming service Max, Warner Bros. Pictures, Discovery Channel, CNN and other channels — reports on Wednesday, as it tries to turn its reserves of intellectual property into franchise films. Meme-stock theater chain AMC
AMC,
which also reports Wednesday, following upbeat results from rival Cinemark Holdings Inc.
CNK,
Sales at the theater chains have been lifted in recent months by “Barbie” and “Oppenheimer.” While both were original films, analysts have said the avalanche of sequels and remakes in theaters is unlikely to stop.
The pressure to boost profits will ultimately affect what TV shows and films get made, and what viewers actually consume. And a report from FactSet on Friday found that investors have been more unkind than usual to companies whose results come up short of Wall Street’s expectations.
That report found that through the third-quarter earnings season, companies whose earnings miss expectations have seen an average stock-price drop of 5.2% during the two days before the publication of the results through the two days after. If that figure holds, it would be the stock market’s biggest adverse reaction to an earnings miss since the second quarter of 2011.
This week in earnings
Among S&P 500 companies, 55 including one from the Dow, will report quarterly results during the week ahead.
EV startup Rivian Automotive Inc.
RIVN,
reports amid concerns about EV demand. Following Ticketmaster parent Live Nation Entertainment Inc.’s
LYV,
blowout quarterly results last week, results from Madison Square Garden Entertainment Corp.
MSGE,
will shed more light on people’s appetites for live entertainment. Results from digital marketing platform Klaviyo Inc.
KVYO,
and fast-casual chain Cava Group Inc.
CAVA,
— both recent IPOS — will offer a deeper look at digital ad budgets and a competitive restaurant backdrop, respectively.
The New York Times Co.
NYT,
also reports during the week. So do Planet Fitness Inc.
PLNT,
Gilead Sciences
GILD,
eBay Inc.
EBAY,
and Take-Two Interactive Software
TTWO,
The call to put on your calendar
Cybersecurity drama: Cyberattacks are getting more severe, and customers are starting to feel their effects more acutely. Against that backdrop, casino and resort operator MGM Resorts International
MGM,
will report quarterly results on Wednesday, in the wake of a cyberattack that took down some of its systems. MGM has said that attack, which the company disclosed in September, would cost them roughly $100 million.
The company said the fallout of that attack — which disrupted hotel bookings and put hotels on manual operations, resulting in long lines — was largely contained to September. But the SEC last week accused software company SolarWinds Corp.
SWI,
of failing to disclose its purported cybersecurity vulnerabilities, potentially leaving other companies wondering whether they’re vulnerable to similar legal action.
The numbers to watch
The gig economy and delivery demand: Rival ride-hailing platforms Uber Technologies Inc. and Lyft Inc. report results on Tuesday and Wednesday, respectively. Maplebear Inc.
CART,
better known as the grocery-delivery platform Instacart, also reports on Wednesday.
Analysts have been kinder to Uber
UBER,
the larger of the two ride-hailing companies. But Lyft has tried to cut its prices and roll out new services, including one that tries to match women and non-binary riders and drivers. The financials from all three companies will land after strong results from food-delivery platform DoorDash Inc.
DASH,
which has expanded its services into retail an effort to compete with Instacart and other delivery providers. And they’ll fill in the picture of rider demand following the back-to-school season and a bigger push to get workers back into offices.
Beyond ride-sharing, results from Uber and Instacart will narrow the lens on delivery demand, as some analysts question whether higher prices for basics and the return of student-loan payments might make food delivery more dispensable. Analysts also seem likely to zero on in those companies’ high-margin digital-ad businesses, as more e-commerce platforms try to turn their apps and websites into online billboard space.
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