Netflix Stock Soars Above $1,000 After Blowout Q1 Earnings Beat on Adds Revenue
Netflix shares gained 1% during trading today and have surged 4% in after hours on positive earnings from adds revenue.
Quick overview
- Netflix shares surged over 4.5% in after-hours trading following a strong Q1 earnings report that exceeded analyst expectations.
- The broader U.S. stock market experienced mixed results, with the Dow Jones dropping 1.3% due to a significant decline in UnitedHealth's stock.
- Despite macroeconomic challenges, Netflix's solid performance and optimistic guidance for Q2 suggest continued growth in the streaming sector.
- Investors are cautious as they await further earnings reports and navigate a long weekend with U.S. exchanges closed until Monday.
Netflix shares gained 1% during trading today and have surged 4% in after hours on positive earnings from adds revenue.
Wall Street Ends on a Mixed Note as Tech Stocks Rise, Healthcare Slumps
U.S. markets opened Thursday with a positive tone, but the early optimism quickly lost steam. The Nasdaq Composite slipped 0.3%, while the Dow Jones Industrial Average suffered a sharper decline, falling 1.3%. The drop was primarily driven by a staggering 25% plunge in UnitedHealth shares, following the company’s downward revision of its earnings outlook. This dramatic decline in the healthcare heavyweight dragged down the entire blue-chip index, muting gains seen in the tech sector.
With a long weekend ahead and markets set to remain closed until Monday, investor sentiment was tempered by a mix of earnings surprises, sector-specific volatility, and ongoing macroeconomic concerns.
Netflix Stock Chart – Soaring From 2022 Lows to New Heights
Netflix shares jumped 5% in after-hours trading following a strong earnings report. Futures surged to $1,017, well above the regular session close of $973, although heightened volatility led to a choppy session post-spike. The broader trend remains bullish—NFLX has gained significantly since summer 2022, when it was trading below $170. With this latest rally, the stock has reclaimed the $1,000 threshold and is on track to notch a fresh all-time high.
Netflix Smashes Q1 Expectations — Stock Surges After Hours
Despite broader market softness, Netflix (NFLX) took center stage after the closing bell, delivering a robust Q1 earnings report that beat Wall Street expectations. Analysts surveyed by LSEG had forecast earnings per share at $5.71 and revenue at $10.51 billion, but Netflix comfortably exceeded both.
Netflix Q1 2025 Earnings Snapshot:
Q1 Revenue:
- Reported at $10.54 billion, narrowly ahead of forecasts.
- Reflects solid momentum from ongoing subscriber growth and pricing adjustments.
Q1 EPS:
- Delivered at $6.61, far surpassing the $5.71 estimate.
- Boosted by operational efficiency and controlled content spending.
Full-Year Revenue Guidance:
- Reaffirmed at $43.5 billion to $44.5 billion.
- Underscores confidence in content pipeline and monetization strategies.
Q2 EPS Outlook:
- Projected at $7.03, pointing to continued earnings growth.
- Suggests stable margins and increasing benefits from global scale.
Netflix’s strong first-quarter performance reinforces its leadership in the streaming space. Despite a challenging macro backdrop and intensifying competition, the company’s focus on profitability and strategic execution helped deliver both revenue and earnings surprises. Its optimistic Q2 guidance further supports the view that Netflix is on a steady path of growth through 2025.
The streaming behemoth credited the better-than-expected profits to “slightly higher subscription and ad revenue, as well as the timing of expenses.”
For the second quarter, the business predicts 15% revenue growth, driven by recent price increases and sustained growth in membership and advertising income, with an operating margin of 33%, a 6% year-over-year improvement. The business estimates EPS of $7.03, which is more than the consensus of $6.24. Looking ahead, the business reiterated its revenue forecast for 2025 as $43.5 billion to $44.5 billion, with a target operating margin of 29% for 2025.
Netflix claimed it repurchased 3.7 million shares in the quarter for $3.5 billion, the biggest it has ever done in a quarter, and stated that it is now producing in over 50 countries.
What’s Next for Netflix?
The sharp rise in NFLX shares reflects renewed investor confidence in the company’s growth story. However, with post-earnings volatility still unfolding, attention will shift to Friday’s pre-market session and Monday’s open to gauge whether the rally can hold.
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