Netflix Inc (NASDAQ:NFLX) is scheduled to report its third-quarter results Wednesday, after the market close.

The consensus estimate calls for earnings of $1.04 per share, up from 89 cents per share in the year-ago quarter. Analysts, on average, expect the company to report revenues of $5.25 billion, up 31.30% year-over-year.

Over the past four quarters, Netflix has managed to beat earnings per expectations by an average of 24.08%.

In the second quarter, the company reported forecast-beating earnings per share and revenues roughly in line with estimates. However, subpar net subscriber additions worried investors, who sent the stock down by 10%. The company blamed the shortfall in paid net adds on the second quarter's content slate and the pull-forward effect in the first quarter, which saw net adds of 9.6 million.

Key Metrics To Watch

Streaming Revenues: Sell side consensus calls for streaming revenues of $5.18 million for the third quarter and $5.45 million for the fourth quarter.

Global paid net adds: The company shoots for a 7 million number compared to 6.1 million in the third quarter of 2018. The break-up of the global paid net adds works out to 0.8 million domestically and 6.2 million internationally.

The company said in its second-quarter earnings report it had a strong start to the third quarter with respect to its content slate. Apart from the season 3 of "Stranger Things," the second half content slate comprises new seasons of "La Casa de Papel," "The Crown" and the final season of the "Orange is the New Black" as well as big films like "The Irishman" and action movie "6 Underground."

Operating Margin: Netflix guided to a 300-basis point year-over-year expansion in operating margin in 2019.

Fourth Quarter Guidance: For the December, quarter, analysts estimate earnings per share of 82 cents on revenues of $5.52 billion, up 31.20%.

The consensus expectations for the year is at earnings per share of $3.24 and revenues of $20.21 billion.

Sell-side consensus for fourth-quarter paid global net adds is at 9.6 million.

See Also: Netflix Analyst Eyes Complications Of A 'Hit-Driven Business'

Competition – A Real Threat?

The streaming arena is seeing the imminent entry of several players, both from the traditional media as well as tech companies.

Some of the planned streaming offerings are:

However, analysts are optimistic about Netflix weathering the competitive pressure.

"We continue to believe that the relative value (price divided by content consumed) of Netflix far exceeds any of the current or planned competitive offerings, making it unlikely that any of them will replace Netflix as consumers' primary streaming choice," Goldman Sachs analyst Heath Terry said.

Stock Take

Netflix shares have lost about 27% in the third quarter, although the stock is still up about 5.8% in the year-to-date period.

The near-term risk/reward on Netflix is neutral, according to KeyBanc analyst Andy Hargreaves. (See his track record here.)

The analyst sees a slightly higher likelihood of in-line results or upside driving shares higher, but a greater potential magnitude of downside in the event of a miss.

"Longer term, we maintain a positive view of the Company's potential, but would like to see greater evidence of stability in investment efficiency or strong elasticity around lower-priced plans to become more positive on the shares," Hargreaves said.

KeyBanc has a Sector Weight rating for the shares of Netflix, with a fair-value estimate of $290 for the shares.