While the COVID-19 pandemic continues to cripple the global economy, some business formats like Netflix and Amazon have stood to benefit from the widespread quarantine.
The novel coronavirus outbreak has been really taxing on the economic stability of different countries around the world. Even our very own entertainment industry has lost more than $20 billion in revenue, so it’s safe to say that most non-essential businesses have currently come to a halt. Additionally, with nearly 2 million confirmed patients and 126,681 deaths (at the moment of writing), governments and health officials are advising people to remain indoors, while struggling to provide for them or compensate for their losses.
Yet, companies like Netflix and Amazon have thrived amid the engulfing shutdowns and come out on top, mostly due to their business format, with the former providing thousands of hours of entertainment on-demand and the latter serving as one of the major delivery systems, both taking care of essential needs in this period of quarantine.
In fact, Netflix’s stock rose 4% to $413.55 on above-average volume and Amazon experienced a 5% uptick, finishing up at $2,283.32, which is also better than average volume. In the current fiscal year, Amazon’s stock value is up 24% while Netflix has managed a 25% increase in the same span.
Additionally, both companies are expected to report their first-quarter earnings this month, so it’ll be interesting to see just how much the COVID-19 situation has affected them and also the lives of the population.
Taking the recent shutdowns into account, even in Netflix’s own original shows like Stranger Things and The Witcher, one would argue that the streaming juggernaut would have difficulty keeping up with audience participation. But owing to its huge library of movies and TV shows, the company is prepared to withstand the current pandemic for quite a while.
Of course, it’s also worth noting that streaming services like Disney Plus, Comcast, Apple, and WarnerMedia are all improving on their availability to challenge Netflix, but it’s clear that they still have a long way to go to catch up.
