Netflix’s ‘Squid Game’ Brings in Nearly $900M – Is It a Good Time to Invest?

Mandatory Credit: Photo by Jakub Porzycki/NurPhoto/Shutterstock (12536579a)Squid Game series logo displayed on a phone screen and Netflix website displayed on a laptop screen are seen in this illustration photo taken in Krakow, Poland on October 13, 2021.
Jakub Porzycki/NurPhoto/Shutterstock / Jakub Porzycki/NurPhoto/Shutterstock

Even if you don’t watch “Squid Game” — the dystopian Korean drama that has become a global sensation while airing on Netflix — you’ve probably heard of it. It is not only Netflix’s biggest TV show ever, but it’s also a cash cow, producing an estimated $891 million in “impact value,” according to a Variety article that cited Bloomberg data.

See: Netflix Partners With Walmart to Sell ‘Squid Game’ & ‘Stranger Things’ Show Merch
Find: How Much Is Netflix Worth?

That’s a pretty good piece of change, considering that Netflix reportedly paid only $21.4 million for the series, which premiered four weeks ago. In the case of “Squid Games,” the financial windfall goes beyond just a big uptick in subscriber viewing. It also means a higher stock price, helped by the buzz the series has generated pretty much everywhere.

As of midday Monday, Netflix’s stock price had risen by about 24% over the past couple of months. It’s up more than 20% for the year, despite spending much of 2021 either moving sideways or south. The company’s stock performance this year is better than those of Apple and Amazon, CNN Business reported, and about on par with Facebook.

Netflix, which is scheduled to report third-quarter earnings on Tuesday, is also beating media rivals such as Disney, ViacomCBS, Comcast and WarnerMedia parent AT&T.

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Not surprisingly, “Squid Game” has played a major role in Netflix’s turnaround. In the 23 days following the show’s Sept. 17 debut, some 132 million Netflix households streamed at least two minutes of the show, according to Bloomberg. About 89% of those viewers watched at least 75 minutes, while 66% finished the entire series within the first 23 days of its release. Overall, Netflix users streamed more than 1.4 billion hours of “Squid Game” over that 23-day period.

So is it a good time to buy Netflix stock? You might want to wait until after Q3 results come in tomorrow. Analysts expect revenue of $7.5 billion, which would be a gain of 17% from the prior year. Earnings are seen climbing 47% to $2.56 a share.

See: Most Expensive Movies Debuting on Streaming in 2021
Find: Which Streaming Services Give You the Most for Your Money?

But most eyes will be on Netflix’s subscriber count, which had been a concern earlier in the year. Analysts estimate that the company added roughly 4 million subscribers during the third quarter, which would bring the worldwide total to 213.3 million.

Wall Street will also be keeping a close watch on Netflix’s guidance for the fourth quarter to see if it meets the lofty expectations of analysts, who project 8 million new subscribers during Q4. If the company falls short on some of those numbers, don’t be surprised if its stock price takes a hit.

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About the Author

Vance Cariaga is a London-based writer, editor and journalist who previously held staff positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal and Business North Carolina magazine. He holds a B.A. in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting earned awards from the North Carolina Press Association, the Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A native of North Carolina who also writes fiction, Vance’s short story, “Saint Christopher,” placed second in the 2019 Writer’s Digest Short Short Story Competition. Two of his short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. His debut novel, Voodoo Hideaway, was published in 2021 by Atmosphere Press.

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