TSX gains after CPI shows US inflation rose 3%
Netflix plans to boost revenue by raising engagement, cutting churn, and expanding entertainment offerings, with gaming and ad growth as potential 2025 drivers. Analysts now forecast $45.1 billion in revenue, $13.6 billion in operating profit in full year 2025, and a 30.3% margin (up from 29.6%).
Key Highlights
- Netflix shows strong financials: a perfect Piotroski score of 9, 15% YoY revenue growth in Q2 2025, and raised full-year guidance to $44.8–$45.2B with 30% operating margins. International subscriber growth is healthy, fueling revenue gains and future expansion.
- The ad-supported tier reaches 94M monthly viewers; ad revenue is forecast to double in 2025 to $1.3B. A new partnership with Amazon Ads will give Amazon DSP access to Netflix inventory across 11 countries from Q4 2025, potentially accelerating ad growth.
- The company’s content momentum remains strong—hits like Squid Game and upcoming releases (Wednesday, Stranger Things)—while it expands into gaming through partnerships such as Grand Theft Auto and Roblox.
- Netflix trades at a premium (P/E 45.34), leaving little margin for execution errors or missed growth. Intense competition from other streamers and traditional media threatens subscriber growth and could raise content costs.
Analysts Expectation
- Bernstein SocGen reaffirmed an Outperform rating and $1,390 target on Netflix Valued at over $509B, Netflix holds a "GREAT" financial health score from InvestingPro.
- UBS reaffirmed its Buy rating and $1,495 target on Netflix, forecasting Q3 revenue up 17% and operating income up 25%, in line with management guidance.
- BMO Capital reaffirmed an outperform rating and $1,425 target, citing strong viewership and upcoming content.
NFLX Q3 2025 earnings after-market (4:01 pm ET) Tuesday October 21, 2025
Technical Analysis Perspective
- NFLX has trended upward since June 2022, making higher highs and lows.
- In early July 2025 the stock broke below the rising trendline from the April 2025 low of 821.
- It is now consolidating the April–June ’25 gain (821 - 1341).
- Price is trading in a rectangle between roughly 1,280 and 1,135.
- NFLX will likely remain in this range after today’s earnings.
- A breakout above or below the range should determine the next directional move.
Weekly Candlestick Chart
NFLX Seasonality Chart
Since 2006, NFLX has seen October close with a 7% gain in 75% of years and November with a 2% gain in 56% of years.
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