Raphael Stevens

Stocks of other streaming video companies fell in extended trading on Tuesday after Netflix revealed it had lost subscribers during the first quarter, its first decline in more than a decade.
Netflix warned that it could start to crack down on password sharing, which could increase its number of paid subscribers.
As the economy reopens in the U.S. and people spend more time out of their houses, it’s almost as if the pandemic never happened — at least in terms of the relative weakness of Netflix stock.

The stock prices of streaming video companies fell in extended trading on Tuesday after Netflix released earnings that showed the sector leader lost subscribers for the first time in more than a decade.
Shares of Disney dropped as much as 5%, while Roku fell 6% after-hours after rising nearly 8% during regular trading. Warner Bros. Discovery, the owner of HBO Max, was off about 4%, and Paramount (formerly ViacomCBS) declined nearly 6%.

The news highlighted investor fears over a broader slowdown of consumer spending.
Netflix fell more than 25% in extended trading on Tuesday after reporting a loss of 200,000 subscribers in its recent quarter and projecting a loss of 2 million subscribers in the second quarter.

Reed Hastings, Co-CEO, Netflix speaks at the 2021 Milken Institute Global Conference in Beverly Hills, California, U.S. October 18, 2021.
David Swanson | Reuters

The video streamer also warned on Tuesday that it could start to crack down on password sharing, which could increase its number of paid subscribers. Netflix has allowed its 222 million users to share their account information with friends and family during its heady growth, but now it wants all users to pay. It estimated that as many as 100 million people were streaming Netflix with someone else’s password.
Netflix and other streaming companies were significantly boosted by the pandemic as consumers spent more time and money streaming content from home.
But as the economy reopens in the U.S. and people spend more time out of their houses, it’s almost as if the pandemic never happened — at least in terms of the relative weakness of Netflix stock.

On Tuesday, shares hit their lowest level since November 2019. The stock is now down more than 40% for the year, and more than 60% from its peak in November 2021.

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After years of resisting advertisements on its streaming service, Netflix is now “open” to offering lower-priced tiers with ads, co-CEO Reed Hastings said Tuesday.
Hastings has long been opposed to adding commercials or other promotions to the platform.
He said during the company’s prerecorded earnings conference call, however, that it “makes a lot of sense” to offer customers a cheaper option.

After years of resisting advertisements on its streaming service, Netflix is now “open” to offering lower-priced tiers with ads, co-CEO Reed Hastings said Tuesday.
Hastings has long been opposed to adding commercials or other promotions to the platform but said during the company’s prerecorded earnings conference call that it “makes a lot of sense” to offer customers a cheaper option.

“Those who have followed Netflix know that I have been against the complexity of advertising and a big fan of the simplicity of subscription,” Hastings said. “But as much as I am a fan of that, I am a bigger fan of consumer choice, and allowing consumers who would like to have a lower price and are advertising-tolerant to get what they want makes a lot of sense.”

In this photo illustration the Netflix logo in the App Store seen displayed on a smartphone screen.
Rafael Henrique | SOPA Images | LightRocket | Getty Images

The option likely wouldn’t be available on the service for a year or two, Hastings said. A new ad-supported tier has a lot of profit potential for Netflix, which on Tuesday reported its first subscriber loss in more than a decade.
Netflix cited growing competition from recent streaming launches by traditional entertainment companies, as well as rampant password sharing, inflation and the ongoing Russian invasion of Ukraine for the recent stall in paid subscriptions.
In an effort to lure more subscribers, Netflix has increased its content spend, particularly on originals. To pay for it, the company hiked prices of its service. Netflix said those price changes are helping to bolster revenue but were partially responsible for a loss of 600,000 subscribers in the U.S. and Canada during the most recent quarter.
A lower-tier option that includes advertisements could keep some price-conscious consumers with the service and provide Netflix with a different avenue to garner funds.
“It’s pretty clear that it’s working for Hulu. Disney is doing it. HBO did it,” Hastings said. “I don’t think we have a lot of doubt that it works.”

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Monday – Friday, 6:00 – 7:00 PM ET

It’s that time again! “Mad Money” host Jim Cramer rings the lightning round bell, which means he’s giving his answers to callers’ stock questions at rapid speed.

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Vale SA: “Vale’s a buy. … In this new world, they’re a winner.”

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Veru Inc: “I would tell you that this stock fluctuates, and you want to try to buy it on a big dip.”

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Allego NV: “In the end, that is just not a good business. … They’re better at it than most, so I will bless it, as long as you understand it’s not a great business.”

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Monday – Friday, 6:00 – 7:00 PM ET

Wall Street should have been down Tuesday, yet the stock market had a great run.
The usual suspects all lined up against the market.
CNBC’s Jim Cramer listed three primary reasons for what he called the “bizarre action” in the market.

Wall Street should have been down Tuesday, yet the stock market had a great run.
The usual suspects — tons of negative analyst notes, rising bond yields, mixed earnings, light housing data and spiking commodity prices — all lined up against the market Tuesday. Not to mention, St. Louis Federal Reserve Bank President James Bullard’s comments a day earlier that a 75-basis point interest rate hike could be a possibility at an upcoming policy meeting to accelerate the central bank’s fight against inflation.

“If the usual suspects all have alibis, what can explain today’s unexpected rally,” CNBC’s Jim Cramer said on Tuesday’s “Mad Money.” “I think we tend to underestimate our advantages,” he added.
Cramer listed three primary reasons for what he called the “bizarre action” in the market.

The market was oversold, which makes it harder for stocks to plummet.
Cramer recalled 1994 when the Fed doubled rates and stocks still rallied. If history is any indicator, Bullard’s tough talk might not be so bad after all, he said.
Another reason for the market’s resilience Tuesday, according to Cramer, is the U.S. being in a better position than other countries, pointing to America’s reopening economy and reliable energy sources.

While inflation is admittedly a problem, Cramer’s got an answer for that, too.
“We got higher flank steak prices, more expensive corn flakes and bigger gasoline bill, but we also have much higher wages to combat the pain,” he said.

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Monday – Friday, 6:00 – 7:00 PM ET

Bank of America CEO Brian Moynihan told CNBC’s Jim Cramer on Tuesday that Americans are spending heartily, even as inflation continues to roil the economy.
“Don’t fight the U.S. consumer. They are a very strong force and you can see them very healthy. Their loan balances are down, they have plenty of borrowing capacity and they have plenty of spending capacity,” he said.

Bank of America CEO Brian Moynihan told CNBC’s Jim Cramer on Tuesday that Americans are spending heartily, even as inflation continues to roil the economy.
“In the month of March ’22 versus March ’21, the consumer … spent about 13% more than they did last year,” Moynihan said Tuesday in an interview on “Mad Money.” 

“But importantly, in the first couple weeks in April, that number’s moved back to 18%, indicating faster spending in consumers,” he added.
Consumer prices increased 8.5% year-over-year in March, revealing price jumps for everyday items not seen since the 1970s and early ’80s. The producer price index showed an 11.2% increase in March from the year prior.
Moynihan said that consumers have bulked up their bank accounts since pre-pandemic times, driving their increased spending. He added that while some investors might take on an approach of ‘don’t fight the Fed,’ he has a different take.
“Don’t fight the U.S. consumer. They are a very strong force and you can see them very healthy. Their loan balances are down, they have plenty of borrowing capacity and they have plenty of spending capacity,” he said.
Bank of America beat Wall Street expectations on profits and earnings in first-quarter financial results posted Monday. Shares climbed 3.4% the same day.

Shares of Bank of America climbed 1.85% on Tuesday.
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A Powerball ticket purchased in Michigan in May 2021 and worth $1 million is set to expire in about two weeks.
Last month in Maryland, no one came forward by the deadline to claim a $10 million prize. 
There have been larger amounts that have gone unclaimed in both Powerball and Mega Millions lotteries.

Justin Sullivan | Getty Images

Powerball players may want to make sure they’re looking more closely at their numbers after each drawing.
In about two weeks — on May 5 — a ticket purchased in Michigan a year earlier and worth $1 million will expire. And just last month in Maryland, no one came forward by the deadline to claim a $10 million Powerball prize. 

“You need to check your ticket for all prize levels,” said Carole Gentry, spokesperson for Maryland Lottery and Gaming. “Just because you haven’t won the jackpot doesn’t mean you didn’t win another prize.”
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Powerball’s top prize for Wednesday night’s drawing is $370 million — making the unclaimed lower-tier prizes pale in comparison.
Yet some jackpot prizes also have gone unclaimed by their winners over the years in both Powerball and Mega Millions lotteries. 
They range from a $16.5 million prize (one-third of a $50 million jackpot split three ways) from a ticket purchased in Florida in 2013 to a $77.1 million prize from a ticket purchased in Georgia in 2011.

And beyond the top prizes, there are lesser amounts that also can end up unclaimed, whether due to loss of a ticket, forgetting to review the winning numbers or other mishaps.

Arrows pointing outwards

On top of the multistate games, there are state-specific lotteries with prizes that never make it into the hands of winners.
For instance, in California in 2016, no one came forward with a winning ticket for a single lottery prize worth $63 million.
Each state that participates in Powerball and Mega Millions has its own rules for how long winners get to claim their prizes. Some allow three or six months, while others provide a full year from the date of the drawing.

So what happens to those unclaimed winnings? Generally speaking, the money goes back to the states selling the tickets.
And from there, it depends on the state’s rules. In some jurisdictions, the funds must go back to players in the form of bonus prizes or second-chance contests. In other places, the unclaimed amounts also may go toward specific purposes such as education funding.
The chance of winning Mega Millions is 1 in about 302 million. For Powerball, it’s 1 in 292 million.

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