Netflix, Inc. NFLX will report first-quarter earnings after the closing bell on Thursday amid market volatility due to President Donald Trump’s tariff pressures. Will Netflix’s results lift Wall Street, and is the stock a buy now? Let’s dive in. 

Netflix’s Q1 Earnings Expected to Lift Share Price 

On Thursday, Netflix will discuss revenue growth, operating margins and user engagement but won’t reveal quarterly subscriber numbers. Management expects a revenue increase of 11.2% in the first quarter from a year ago. This is below the full-year guidance, but it is due to the seasonality impact on the ad business. Netflix forecasts 12% to 14% revenue growth in 2025, with an estimate of $43.5 billion to $44.5 billion, up $500 million from its previous projection. 

For the full year, Netflix is aiming for an operating margin of 29%, up from the prior guidance of 28%. For the first quarter, it aims for an operating margin of 28.2%, a solid net income of $2.44 billion and earnings per share (EPS) of $5.58. Also, Netflix has, on average, delivered a positive trailing four-quarter earnings surprise of 7.2%, suggesting it may achieve the anticipated first-quarter earnings growth, potentially boosting the stock price. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.) 

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Netflix’s Business Unaffected by Tariff Impact 

Despite the recent global market turmoil caused by President Trump’s tariffs and U.S. recession fears, Netflix stock remained steady. Netflix’s strong subscription model helped the stock gain 4.6% month to date, whereas the Broadcast Radio and Television industry fell 5.2%.  

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Also, during recessions, consumers value television more as they spend increased time at home, as noted by Oppenheimer analysts. This is a boon for Netflix since the company can benefit from the upcoming release of many shows, driving subscriber growth. 

Now, the economic slowdown may compel companies to trim their ad budgets, which could impact Netflix. However, Netflix’s sales are not primarily reliant on ads. Instead, the company can use its huge customer data to tailor products based on viewers’ habits and enhance its subscriber base.  

Netflix Eyes $1T Market Capitalization 

The Wall Street Journal, meanwhile, reported that Netflix aims to join the $1 trillion club by 2030. Some of the prominent names in that club include Apple Inc. AAPL, Microsoft Corporation MSFT, NVIDIA Corporation NVDA, and Alphabet Inc. GOOGL. The streaming giant aims to double its revenues from last year’s $39 billion and generate nearly $9 billion in global ad sales by 2030. Operating income is expected to triple from $10 billion last year and the subscriber base is expected to grow to around 410 million within the stipulated time frame. 

All of these possibilities are conceivable as Netflix explores ways to expand its subscriber base in countries like India and Brazil by implementing new policies. Netflix aims to introduce live events and more affordable ad-supported subscriptions to increase its paid membership in these regions. Lest we forget, the live streaming of two NFL games on Christmas Day helped Netflix attract an audience of 30 million, a move that proved to be a game-changer.   

Here’s How to Trade Netflix Stock Before Q1 Earnings 

Netflix’s dominance in the streaming platform has led the company to set ambitious targets, showcasing its resilience in a difficult, tariff-heavy environment. Moreover, management’s optimism regarding improved quarterly results and full-year guidance, which is based on anticipated subscriber growth, should certainly convince stakeholders to remain invested in the stock.  

Brokers are also optimistic about the company’s growth story as they raise Netflix’s average short-term price target by 15.8% to $1,078.77 from the previous $931.28. The highest short-term price target is set at $1,494, indicating an upside of 60.4%. 

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However, despite a positive outlook for the future, Netflix may face market saturation in the United States and Canada while encountering challenges in expanding into price-sensitive emerging economies. New entrants should refrain from investing until the results of Netflix’s expansion efforts become clear, considering the company’s leveraged balance sheet.

Netflix has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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