How To Trade Netflix Stock Before And After Q3 Earnings

When Netflix, Inc. releases its third-quarter financial results on Tuesday after the market closes, it will serve as the first major tech earnings announcement.

The severely battered stock surged throughout the morning trading session but dropped along with the overall markets in the lead-up to the event to trade marginally lower.

The stock was trading sideways when the streaming giant released its second-quarter results on July 19, but the news of the earnings led Netflix to break bullishly into an uptrend.

Netflix announced profits per share for the second quarter of $3.20, above the Street expectation of $2.96. The company's $7.97 billion in reported sales fell short of the $8.04 billion average expectation.

According to the company's guidance, it lost 970,000 customers during the quarter rather than the 2 million it had predicted it would lose.

Analysts anticipate Netflix will announce profits per share of $2.13 on revenues of $7.84 billion for the third quarter.

Traders and investors will be keeping a close eye on Netflix to see if it has been successful in increasing both its user base and customer retention.

Technically speaking, the stock of Netlix appears neutral going into the event and will need to take direction from Tuesday's after-market candle.