Netflix’s latest earnings and surprisingly stable outlook defy the souring economy and plummeting consumer confidence
From Yahoo Finance: 2025-04-17 17:12:00
Netflix’s stock surged over 4% in aftermarket trading after exceeding Wall Street expectations in first-quarter earnings. Despite low U.S. consumer confidence, Netflix maintains positive business forecasts and a solid revenue outlook through 2025. The company’s confidence may reassure investors amid economic uncertainty caused by the U.S.-China trade war.
Netflix’s co-CEO, Greg Peters, stated that the company remains largely unaffected by economic turmoil, with stable customer retention and strong engagement in shows. The company’s diverse subscription plans, including an $8 monthly plan with ads, offer flexibility for cost-conscious customers. While advertising is a small part of revenue, new tools make it attractive to advertisers.
During the quarter, Netflix beat revenue and profit estimates, with $10.54 billion in revenue and earnings per share of $6.61. The company chose not to report subscriber numbers, arguing that various subscription tiers and the growing ad business provide a better view of its performance. Netflix aims to reach a $1 trillion market cap by 2030.
Netflix’s hit series “Adolescence” led content wins in the first quarter, becoming the third-most-watched English language series on the platform. In the previous quarter, Netflix added over 18.9 million global members and increased its standard plan to $17.99 per month. The company’s unique business approach, similar to Amazon’s flywheel, continues to drive growth.
Netflix maintains its strategic growth plans despite economic uncertainties, aiming to double revenue and triple operating income by 2030. The company also targets $9 billion in annual ad sales. Despite challenges, Netflix’s strong performance in the first quarter underscores its resilience in the face of potential crises.