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Netflix CEO Reed Hastings  (Source: siliconangle.com)
According to Thomson Reuters, I/B/E/S, analysts expect third quarter revenue to come to $801.53 million and earnings per share at 94 cents

Netflix has had a pretty hard time this year with all the recent changes it made as well as the negative reactions to said changes. Now, investors are wondering what Netflix will report as far as quarterly earnings go on Monday, but the expectations aren't too high.

Netflix announced in July that it was raising prices and changing the plans available for customers. Instead of a monthly price of $9.99 for both video streaming and DVD by mail, these two plans would be split into their own categories for $7.99 a piece. Obtaining both together would cost $15.98.

Other hiccups came up along the way, such as Netflix's loss of Starz content and its decision to create a DVD spin-off company called Qwikster, which it retracted less than a month after announcing the new DVD entity.

Now, Netflix is paying for all this stumbling around through mid 2011. It already cut its U.S. subscriber predictions from 25 million to 24 million for the quarter, and investors don't expect to hear anything else worthwhile when Netflix's quarterly results are released on Monday.

"Between lower-than-anticipated [subscriber] growth and the reversal of the decision to completely separate the DVD streaming business, these are clearly trying times for Netflix," said Steve Frankel, a Dougherty and Co. analyst. "The near term is clouded by higher than anticipated churn, a situation which is likely to negatively impact the fourth quarter as well."

According to Thomson Reuters, I/B/E/S, analysts expect third quarter revenue to come to $801.53 million and earnings per share at 94 cents. It also expects Netflix to achieve its lowered subscriber growth number. In Q3 2010, Netflix generated $553 million in revenue, but gained 1.9 million subscribers.

Things aren't looking good for Netflix right now in the eyes of investors, and investors expect some clear answers come Monday. However, some analysts say they're looking ahead to the fourth quarter, since it holds the holiday shopping period and is usually a strong time for Netflix. Also, analysts are optimistic because Netflix's expansion internationally is expected to move into Europe next, and Netflix still has a content library "far ahead" of the likes of Blockbuster.

Source: Reuters





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