Netflix (NFLX) late Thursday beat Wall Street’s targets for sales and earnings in the first quarter and guided above views for the current period. Netflix stock rose on the news.
The internet television network earned $6.61 a share on sales of $10.54 billion in the March quarter. Analysts polled by FactSet had expected earnings of $5.67 a share on sales of $10.5 billion. On a year-over-year basis, Netflix earnings increased 25% while sales rose 12.5%.
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Netflix’s Q1 report marked the first time the company didn’t reveal subscriber numbers. It wants investors to focus instead on revenue and operating margin. Netflix ended 2024 with 301.6 million subscribers worldwide.
For the current quarter, Netflix forecast earnings of $7.03 a share on revenue of $11.04 billion. Wall Street was modeling earnings of $6.25 a share on sales of $10.89 billion in the second quarter. In the same quarter last year, Netflix earned $4.88 a share on sales of $9.56 billion.
In after-hours trading on the stock market today, Netflix stock advanced more than 4% to 1,017. During the regular session Thursday, Netflix stock climbed 1.2% to close at 973.03.
In a letter to shareholders, Netflix said its revenue and operating income were ahead of its guidance “due to slightly higher subscription and ad revenue and the timing of expenses.”
The streaming video leader kept its full-year guidance unchanged. It expects revenue of $44 billion at the midpoint of its range and operating margin of 29%. In 2024, its revenue was $39 billion and operating margin was 27%.
Major new programs on Netflix in the first quarter included movies “Back In Action,” “The Electric State” and “The Life List” and series “Adolescence,” “American Primeval” and “Running Point.”
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Netflix Stock Near Buy Point
Netflix stock has been holding up better than most during the current market upheaval. Analysts see entertainment services like Netflix and Spotify (SPOT) as defensive plays in a difficult macroeconomic climate.
Netflix stock has formed a double-bottom base with a buy point of 998.70, according to IBD MarketSurge charts. It is poised for a breakout on Monday if after-hours trading gains carry over to the regular session. Markets are closed Friday for Good Friday.
On Monday, the Wall Street Journal reported that Netflix has set an internal goal of doubling its revenue by 2030 and reaching a $1 trillion market cap. In 2024, Netflix generated revenue of $39 billion. Its current market valuation is about $417 billion.
Netflix stock is on four IBD stock lists: Leaderboard, Big Cap 20, IBD 50 and Stock Spotlight.
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Follow Patrick Seitz on X, formerly Twitter, at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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