Wible estimated that Netflix needs at least four streaming subscribers to account for the loss of one DVD user. Bernstein Research analyst Carlos Kirjney said he expects domestic streaming margin should expand to 18% over the next three years from about 8% currently. But he believes this growth will be offset by erosion in the DVD business, estimating DVD subscribers in the U.S. will fall to 4.6 million by the end of 2016 from 10 million in the first quarter of 2012. "We still believe the key issue for bullish or bearish investors should rest with Netflix's ability to scale the streaming business, increase price (again) and/or layer on new services," Wible wrote. "Without these incremental earnings drivers, we believe investors will find that Netflix does not generate nearly as much value per subscriber as it did only a few years ago. The rebound in subscribers may act as a near-term catalyst for the stock, but the first-quarter guidance will be paramount as it could trigger more earnings revisions." The fourth quarter also will provide the first real insight into international demand. While Netflix only launched its streaming service in the U.K. and Ireland earlier this month, this will be the first full quarter of data for its Latin America and Caribbean service. "We continue to believe that Latin America will provide a more realistic read of the company's strength outside of the U.S. than we would be able to see from the Canadian experience," B. Riley analyst Eric Wold wrote in a note. "While greater-than-expected subscriber demand internationally could mean higher losses initially than most have modeled, we believe that it would help to lessen investor concerns that Netflix is a U.S.-only story." The problem is that Netflix's international strategy remains a looming question mark. "The key will be further details on the timing and investment size of Netflix's international rollouts," Mahaney wrote. "But this is a major unknown in our model and will be driven in part by the company's elective decisions as to how far and how fast to expand internationally. There is also the risk that market and competitive conditions may cause Netflix to have to invest even more aggressively in the Latin America and U.K. and Ireland markets."