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Goldman Sachs and Bank of America — What you need to know in markets on Tuesday

Myles Udland
Markets Reporter

After a big rally on Monday amid light volume, investors will have two major U.S. bank earnings reports to sift through on Tuesday.

Before the market open, both Bank of America (BAC) and Goldman Sachs (GS) are set to report first quarter earnings.

Also reporting earnings Tuesday is IBM (IBM), while United Airlines (UAL), which reported earnings after the bell on Monday, will host its earnings conference call. In the company’s release on Monday, United CEO Oscar Munoz said, “It is obvious from recent experiences that we need to do a much better job serving our customers.

“The incident that took place aboard Flight 3411 has been a humbling experience, and I take full responsibility. This will prove to be a watershed moment for our company, and we are more determined than ever to put our customers at the center of everything we do.”

Last week, as you’ll recall, the company was in hot water after video surfaced of a passenger being forcibly removed from a flight.

Goldman Sachs CEO Lloyd Blankfein.

Netflix loves Adam Sandler

On Monday, streaming video giant Netflix (NFLX) reported first quarter results that were mixed.

The company earned $0.40 per share on revenue of $2.64 billion. Wall Street analysts expected earnings of $0.37 on revenue of $2.65 billion. Subscriber adds in the first quarter were a bit light, with the company adding 1.42 million users in the U.S. and 3.53 internationally, below forecasts for 1.5 million and 3.7 million adds domestically and abroad, respectively.

But the commentary that got the most play from the company after its earnings release was the revelation that Netflix users have watched over 500 million hours of Adam Sandler content since the December 2015 release of his movie The Ridiculous 6. And more than just watched, Netflix said subscribers have “enjoyed” this content.

This news was fairly widely panned on social media, with at least a dozen people in my Twitter mentions saying something to the effect of this is why we can’t have nice things.

Elsewhere in its first quarter shareholder letter, however, Netflix again outlines what its goal is as a company: to get you to keep watching Netflix.

“Our goal remains the same: to offer a variety of new movies that will attract and delight members at better economics relative to licensing movies under traditional windowing,” the company wrote.

“Some of our early movies have been successful by this measure, such as the Sandler movies and Siege of Jadotville. Others, such as Crouching Tiger Hidden Dragon: Sword of Destiny, have not. Scott’s mandate is to increase both the portfolio and the percentage of films that delight many of our members relative to the film’s cost.”

Following this news, Derek Thompson, author of the book “Hit Makers,said that the question he was most often asked during his recent promotional tour was what big data says about our tastes. And his answer is that collectively, our tastes are more “basic & repetitive than we thought.” Sandler’s popularity among Netflix users, then, is evidence of this.

But this also makes me think of another point made in his book, or rather what the thesis of the book seems most simply to be, which Thompson said is that, “familiarity beats novelty and distribution beats content.” Which basically says it doesn’t matter if what you’re doing is good or new. In fact, these things might be a detriment. If you want to create popular content, you’re going to do that by playing the hits, by doing what’s been done, and by getting it on a huge platform.

Netflix said Monday that by this weekend, it will 100 million subscribers. That is a massive platform. And through not only its own investment in Sandler’s work but also the audience’s familiarity with his style, in Adam Sandler Netflix has a massive amount of familiarity.

Put these two together and in just 15 or so months, we get 500 million-plus hours of content consumed.

Social media platforms like Twitter encourage users to craft a version of themselves that appeals to other users on the platform. So when it comes to things like discussing the work of Adam Sandler, one must be outwardly critical and dismissive. Twitter rewards the sardonic intellectual.

But the main reason we are aware of users dismissing Sandler’s work en masse is because the network has surfaced tweets, either organically or algorithmically, over time with which we are encouraged to engage — to like, to retweet, or, best yet, to follow a new user. And the more we engage, and follow, and so on, the more the network fills in around us and the more we are (likely) compelled to stay.

Because of course let’s not forget that all the time we spend on Twitter or Instagram or Facebook or Snapchat is meant to try and keep us on these platforms. We are encouraged to become familiar with and to not only our current followers but prospective ones as well.

In a small way, then, we’ve all sought to or been pushed to become mini versions of Adam Sandler across the platforms that populate our own lives. Not so funny now.

Myles Udland is a writer at Yahoo Finance. Follow him on Twitter @MylesUdland

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