What’s going on with Netflix stock

Netflix stock is on the rise this week. Likely due to two days of rumors that the firm may partner with other technology firms to launch an ad-supported streaming service.

As of the market close, the video streaming stock was up by 4.7%.

Why we care

Investors may be propelling Netflix (NASDAQ:NFLX) higher today. According to an AdAge report, Netflix could join forces with Google’s Alphabet (NASDAQ:GOOG)(NASDAQ:GOOGL) to form an advertising collaboration.

Netflix is searching for innovative methods to increase its subscriber count, and the company has previously stated that a subscription-free streaming service is in development. Given Alphabet’s ownership of one of the world’s most extensive digital advertising networks, collaborating with it makes sense.

Investors may have been thinking about the possibility of Google’s collaboration with Netflix and associated it with Needham analyst Laura Martin’s claims that Netflix is considering using Roku (NASDAQ:ROKU) to promote its ad-supported service.

In an investor note, Martin stated:

“[Netflix] must buy more Roku ad units to tell the largest base of streaming customers what new content is coming to NFLX and why they should watch it.”

Although Roku is a household name in the United States, it has a lot of competition. It’s also expanding to markets like Mexico and Thailand. Roku’s global presence – with 61 million units worldwide – may help Netflix reach customers seeking an ad-supported streaming service.

What now

It’s not surprising that Netflix’s stock is rising today, given the company’s recent news about potential partnerships with Alphabet and Roku. However, it’s worth noting that none of the corporations have announced formal agreements.

The company’s ad-supported tier will be in the spotlight due to this news. Additionally, investors will want to keep an eye on any new developments about it. In addition, given rising inflation, some customers may search for alternative video streaming alternatives, putting pressure on Netflix’s ad-supported tier.

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