5 Best Streaming and TV Stocks To Buy Now

3. Apple TV+ by Apple Inc. (NASDAQ:AAPL)

Number of Hedge Funds In Q2 2023: 135

Apple Inc. (NASDAQ:AAPL) is heavily investing in original content production for its streaming platform, Apple TV+. However, uncertainty lingers about the long-term viability of this strategy. Specific financial data for TV+ remains undisclosed, prompting industry analysts to offer estimates. According to Barclays analyst Tim Long, TV+ currently constitutes around 2% of Apple’s services revenue, with estimated 2022 revenue of $1.5 billion, projected to rise to $2.2 billion in 2023. Notably, Apple’s total services revenue for the fiscal year ending in September 2022 was $78 billion.

Long suggests that TV+ likely operates with negative profit margins, resulting in an estimated loss of approximately 30 cents per share in 2022. These losses are anticipated to persist until 2025 due to substantial content investment, totaling $4.8 billion in 2022, $5.8 billion in 2023, and $6.6 billion in the following year.

Nevertheless, there is optimism regarding potential growth. Long indicates that TV+ is experiencing rapid annual revenue growth of approximately 30%, surpassing the industry’s typical growth rate of around 10%. In 2023, a 52% revenue increase is projected, partly attributed to a subscription price increase from $4.99 to $6.99 per month in October 2022.

Furthermore, Apple’s venture into sports content, including exclusive deals with Major League Soccer and broadcasting rights for Friday night Major League Baseball games, may pave the way for future advertising opportunities on TV+, potentially generating significant revenue for the platform.