As we progress through Q2 2024, it’s valuable to look back at the Q1 earnings season and assess how consumer subscription companies navigated the economic landscape earlier this year. This retrospective analysis focuses on key players in streaming, education, and language learning sectors, offering insights for investors and market watchers.
The Consumer Subscription Landscape: A Q1 2024 Recap
The first quarter of 2024 saw continued demand for personalized, on-demand services across various digital platforms. Let’s examine how major players in this space performed during that crucial period.

Q1 2024 Overview: Mixed Results Amid Early 2024 Volatility
Our analysis tracked eight prominent consumer subscription stocks, which collectively reported mixed results for Q1 2024. On average:
- Revenues exceeded analyst estimates by 0.9%.
- Next quarter revenue guidance fell 2.8% below expectations.
- Share prices dropped 17.3% since their previous earnings reports.
This performance came amid fluctuating market sentiment regarding potential interest rate cuts and inflation trends that characterized the start of 2024.
Netflix (NASDAQ: NFLX): Streaming Giant's Strong Start to 2024
Netflix led the pack in the streaming industry for Q1 2024:
- Q1 revenue: $9.37 billion (14.8% YoY increase).
- Key metrics surpassed expectations: paid subscribers, operating income, EPS, free cash flow.
- Operating margin expanded to 28% (7 percentage point YoY increase).
- Stock performance: Up 12.8% following the Q1 earnings release.

Roku (NASDAQ: ROKU): Solid Growth Despite Initial Stock Reaction
Roku, the streaming hardware provider, reported strong Q1 numbers but faced a slight initial stock decline:
- Q1 revenue: $881.5 million (19% YoY increase, 3.7% above expectations).
- Monthly active users: 81.6 million (14% YoY increase).
- Outperformance: Outperformed adjusted EBITDA forecasts.
- Initial stock performance: Down 0.9% following Q1 earnings.
Duolingo (NASDAQ: DUOL): Impressive Growth, but Stock Pressure
The language learning app showed strong Q1 revenue growth but faced initial stock pressure:
- Q1 revenue: $167.6 million (44.9% YoY increase, 1.1% above expectations).
- Upgrade: Upgraded full-year revenue and EBITDA outlook.
- Initial stock performance: Down 21.1% following Q1 earnings.
Chegg (NYSE: CHGG) and Coursera (NYSE: COUR): Education Platforms Faced Q1 Headwinds
Both online education providers struggled in Q1 2024:
Chegg:
- Q1 revenue: $174.4 million (7.1% YoY decline).
- Users: 4.7 million (7.8% YoY decline).
- Initial stock performance: Down 61.3% following Q1 earnings.
Coursera:
- Q1 revenue: $169.1 million (14.5% YoY increase, 0.8% below expectations).
- Users: 148 million (19.4% YoY increase).
- Initial stock performance: Down 38.9% following Q1 earnings.

Key Takeaways from Q1 2024
- Streaming Resilience: Netflix and Roku demonstrated the continued strength of the streaming sector in early 2024, with robust user growth and revenue performance.
- Education Sector Challenges: Chegg and Coursera’s Q1 struggles highlighted potential headwinds in the online education market, possibly due to changing consumer behavior post-pandemic.
- Growth vs. Stock Performance Disconnect: Companies like Duolingo showed that strong Q1 revenue growth didn’t always translate to positive stock performance in the short term.
- User Acquisition and Retention: Successful companies in this space continued to focus on expanding and retaining their user bases, as evidenced by Netflix and Roku’s Q1 performance.
Looking Ahead: Q2 2024 and Beyond
As we progress through Q2 2024, investors should consider how these companies have built upon or addressed their Q1 performance:
- Netflix and Roku: Are they maintaining their momentum in user growth and revenue?
- Duolingo: Has the market reevaluated its strong growth metrics?
- Chegg and Coursera: Have they implemented strategies to overcome Q1 challenges?
Additionally, keep an eye on broader economic factors that may impact the consumer subscription sector, such as:
- Evolving inflation trends and their impact on consumer spending.
- Potential interest rate adjustments by the Federal Reserve.
- Shifts in consumer behavior as we move further from the pandemic era.
Conclusion: Lessons from Q1 for the Rest of 2024
The Q1 2024 results for consumer subscription stocks revealed a complex landscape where strong financial performance didn’t always align with immediate market sentiment. As we move through the remainder of 2024, investors should closely monitor factors such as user growth, revenue diversification, and adaptability to changing consumer preferences.
For those considering investments in this sector, it’s crucial to look beyond headline numbers and consider long-term growth potential, market positioning, and the ability of companies to innovate in response to evolving consumer demands.
The consumer subscription space remains a dynamic and potentially lucrative area for investors, albeit one that requires careful analysis and a nuanced understanding of individual company strengths and market trends. As Q2 2024 earnings approach, these Q1 insights provide a valuable baseline for evaluating the sector’s ongoing performance and potential.