Despite Netflix’s strong beat on earnings on Thursday, it wasn’t good enough for some Wall Street investors as shares are down more than 5% on Friday.
The streamer posted a 16% increase in revenue to $11.08 billion and 45.6% jump in profits to $3.13 billion in its second quarter of 2025, primarily driven by more subscribers, higher pricing and increased ad revenue.
It also raised its 2025 revenue outlook from $44.8 billion to $45.2 billion, up from previous guidance of $43.5 billion to $44.5 billion, reflecting healthy subscriber growth and ad sales and the weakening of the U.S. dollar compared to other currencies. The update represents growth of 15% to 16% year-over-year.
Though William Blair analyst Ralph Shackart touted a “good quarter and positive tone that business trends remain strong,” he argued the results and guidance were “not good enough for elevated expectations.”
“The above-the-Street revenue guide was due in part to a weaker dollar. The outlook for Netflix remains positive in our view, with a strong slate, a broadening
advertising platform, solid retention, price changes in line with expectations, and stable engagement,” Shackart wrote in a note to clients on Monday. “Overall, Netflix remains well positioned to remain a secular streaming winner, in our view, and we believe it will retain pricing power over the long term.”
Seaport Research’s David Joyce, who remains neutral on the stock with no price target, added that shares “appear close to fully-valuing the current opportunity sets discounted through 2030.” He acknowledged Netflix can find additional upside with advertising and more price increases, but said it would “take time to become evident.”
Others were more bullish, such as Bank of America analyst Jessica Reif Ehrlich who raised her price target on the stock to $1,490 per share and reiterated a buy rating.
“In our view, Netflix shares will be fueled by continued positive subscriber and earnings momentum in addition to evolving advertising and live opportunities,” she wrote in a Friday note to clients. “Supported by its world-class brand, leading global subscriber scale, position as an innovator and increased visibility in growth drivers, we believe that Netflix will continue to outperform.”
MoffettNathanson analysts Michael Nathanson and Robert Fishman, who maintained a buy rating and raised their price target to $1,400 per share, expect Netflix to continue to disrupt the pay TV ecosystem over time and that it will increase spending as it expands into live event and sports content as well as its in-house advertising technology platform.
“We believe the [return on investment] from these moves will lead to even greater
margin expansion and faster earnings growth,” they said.
Piper Sandler analyst Thomas Champion, who raised his price target to $1,500 per share, continues to see Netflix as a “defensive name with multiple upside levers.” He expects the company’s content slate to improve in the back half of 2025 and thinks the company’s guidance “bakes in conservatism.”
J.P Morgan analyst Doug Anmuth added that he believes the ad-supported tier will further expand the company’s subscriber base while driving high-margin incremental revenue, projecting 60 million ad tier subscribers by the end of 2025.But he acknowledged that after “significant stock price appreciation & outperformance, the risk/reward in NFLX shares is becoming more balanced,” leading him to remain neutral on Netflix stock and establish a price target of $1,300 per share.
Netflix stock is up 87% in the past year and 36% year to date. Shares are currently trading at $1,205.96, off its 52-week high of $1,341.15.
