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Streaming giant Netflix (NFLX) will release its Q1 2025 earnings today, April 17, after the close of markets. In this article, we’ll examine the company’s earnings estimates and whether the stock can continue its good run.
Analysts expect Netflix to report revenues of $10.5 billion in Q1, a 12.1% year-over-year. The company’s earnings per share (EPS) are expected to rise 7.8% to $5.69 in the quarter. The first quarter is usually seasonally weak for Netflix, and analysts expect the company’s EPS to rise 23.6% for the full year.
Beginning with Q1, Netflix will stop providing its quarterly subscriber numbers. The company posted stellar subscriber numbers over the previous few quarters and added over 41 million subscribers last year, which pushed its total subscriber count beyond 300 million.
The ad-supported plan, which is cheaper than the ad-free tiers, has also worked wonders for Netflix. According to the company, in Q4 2025, 55% of new members opted for the ad-supported tier in countries where it is offered. The password-sharing crackdown has also helped Netflix grow its subscriber base, as many people who previously watched its content through borrowed accounts are now paid subscribers.
Netflix Has Been Relatively Immune to Tariffs
Netflix has been relatively insulated from the trade war even as other tech and entertainment names have whipsawed. Even streaming peer Disney (DIS) has lost around a quarter of its market cap this year, while Netflix is sitting pretty with a YTD gain of 8.2% as of April 17.
While NFLX’s YTD price action might not seem boast-worthy, it should be seen in the context of the drawdown in broader markets. For context, all of the “Magnificent 7” stocks – of which Netflix is not a part – are in the red and are down in double digits.
Why NFLX Stock Has Outperformed in 2025
Netflix’s outperformance has largely been due to the realization that its business is relatively immune to the tariff noise. Moreover, the company might withstand a recession much better than most others, given how hooked users are to Netflix’s content. While consumers might cut down on other expenses like eating out, most subscribers will not choose to cut Netflix fees from their budgets first, if at all. This is especially true as the company has cracked down on password sharing in key markets and is expected to roll out the initiative in other markets also.
Ritholtz Wealth Management CEO Josh Brown echoes similar views. In an interview, he disclosed buying Netflix shares, terming it "the best stock in the market” for 2025. Brown added that Netflix isn’t “the type of service that anyone cancels. And even if they’re thinking about cancelling it, the lower-priced ad-supported tier will catch those people.” He emphasized that Netflix makes more money per user in the ad-supported tier than in the premium ad-free plans.
Netflix Is Aiming for a $1 Trillion Market Cap by 2030
Brown also referred to reports of Netflix aiming to double its revenues and triple its operating income by 2030. Among others, the company is banking on ad revenues to fuel its growth, targeting annual revenues of $9 billion by 2030. Netflix aims to become a $1 trillion market cap company, as per that report, and that target does not look too lofty considering its current market cap is upwards of $400 billion.
Commenting on Netflix’s internal targets, Bank of America analyst Jessica Reif Ehrlich said, “These targets underscore ample runway for continued growth driven by subscriber adds and further monetization opportunity.”
She added, “Amid recent market volatility, Netflix’s strong subscription model with critical entertainment (which historically has performed well in a recession) has made the stock a defensive choice for investors and driven outperformance versus other technology/Mag Seven companies.”
NFLX Stock Forecast
NFLX is rated as a “Strong Buy” or “Moderate Buy” by almost 70% of the analysts in coverage, while the corresponding number three months back was around 61%. Netflix’s mean target price is $1,077.77, which is 11% higher than the current price.
All said, I find Netflix a good buy for the next couple of years. The company has built a strong moat with its impressive and ever-expanding library of global content. Netflix has also added sports streaming and video games to its offering, which makes it an even better value proposition for subscribers.
Netflix is yet to meaningfully monetize its growing subscriber base on the ad-supported tier, which, coupled with the expansion of a password sharing crackdown in new geographies, should keep its top-line and bottom-line growth in good shape. I continue to remain invested in Netflix, and if there is an adverse reaction to its Q1 earnings report today, I will consider adding more shares to my existing positions.
