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Netflix Q1 earnings preview: how subscriber shifts and new metrics impact growth
Netflix reports Q1 2025 earnings on 18 April, with analysts eyeing revenue growth of 12% despite the company's decision to stop reporting subscriber numbers.
When is Netflix reporting?
Netflix is set to release its first-quarter (Q1) 2025 earnings after the market closes on Friday, 18 April at 6.00am AEST.
Historical data shows that Netflix shares often experience significant price movements following quarterly reports.
Q1 2025 earnings expectations
- Revneue: $10.516 billion, marking a 12.23% year-over-year (YoY) increase, showing continued growth despite an increasingly competitive landscape
- Earnings per share (EPS): $5.73, up 8.55% YoY from $5.28. While this represents positive growth, it's the company's slowest growth rate in seven quarters, potentially reflecting a maturing streaming market and broader macroeconomic headwinds
- Operating margin: has been expanding in recent quarters as content spend stabilises and the benefits of previous price increases flow through to the bottom line. The continued strength of this metric will be crucial for sustaining investor confidence.
Netflix's shift in reporting metrics
Notably, this earnings report marks a significant change in Netflix's approach to performance metrics. This will be the first quarter in which Netflix does not disclose its subscriber count, a metric it has traditionally highlighted as a key performance indicator.
The company announced this change a year ago, signalling a shift in focus toward engagement metrics and financial performance. At the end of 2024, Netflix reported 301.63 million global subscribers, but going forward, investors will need to assess the company's health through different metrics.
This strategic pivot reflects Netflix's evolution from a growth-focused disruptor to a more mature media company concerned with profitability and sustainable expansion. The trading platform community will be watching closely to see what alternative metrics Netflix emphasises to demonstrate its continued momentum.
Instead of subscriber numbers, Netflix is expected to highlight metrics such as viewing hours, retention rates, and average revenue per user (ARPU). These figures will provide valuable insight into how effectively Netflix is monetising its existing user base rather than simply growing it.
Analyst sentiment and recommendations
Despite economic tariff-related uncertainties, many analysts remain optimistic about Netflix's resilience in the streaming market.
JPMorgan has labelled Netflix the 'most resilient' company it tracks, citing strong subscriber engagement and a robust content library that continues to drive viewer loyalty.
Morgan Stanley also considers Netflix a 'top pick,' viewing recent stock dips as buying opportunities rather than causes for concern. This positive sentiment reflects confidence in Netflix's business model and its ability to navigate an increasingly competitive streaming landscape.
According to London Stock Exchange Group (LSEG) data & analytics, 13 analyst have a ‘strong buy’ recommendation, 24 a ‘buy’ and 12 a ‘hold’ recommendation - as of 14 April 2025.
Netflix LSEG data & analytics chart
Netflix has a TipRanks Smart Score of ’7 Neutral’ and is rated as a ‘Buy’ by analysts with 30 ’Buy’, 10 ‘hold’ and 1 ‘Sell’ recommendation - as of 14 April 2025.
Netflix TipRanks Smart Score chart
Netflix's strategic initiatives
- Netflix's advertising-supported tier
This initiative was introduced to attract price-sensitive consumers and is expected to contribute meaningfully to revenue growth in the coming years, as Netflix expands its advertiser base and refines its ad targeting capabilities.
- Live sports venture
Netflix's deal to broadcast NFL games marks its most substantial investment in live programming to date and signals an intention to compete more directly with traditional broadcasters and other streaming services that have already embraced sports content.
- Content spending
Analysts expect further details on how Netflix plans to balance investment in original programming with profitability goals. The company has historically spent billions on content creation, but has recently shown more discipline in this area.
- International growth strategies
Netflix has been investing heavily in local-language content in markets like India, Southeast Asia, and parts of Africa, seeking to drive growth beyond saturated North American and European markets.
- Gaming
While still a relatively small part of Netflix's overall business, the company has been steadily expanding its mobile gaming library and may share engagement metrics or future plans for this vertical.
- Price increases
Analysts will look for indications of whether increases implemented across various markets in late 2024 have led to increased churn, or if Netflix has successfully retained subscribers despite asking them to pay more for the service.
Competitive landscape challenges
The streaming wars continue to intensify, with competitors like Disney+, Amazon Prime Video, and Apple TV+ all investing heavily in content and technology. Netflix's ability to retain its market leadership position in this environment will be a key focus for investors analysing the Q1 results.
What to watch for?
Beyond the headline financial figures, several qualitative aspects of Netflix's earnings call will merit close attention.
- Management's commentary on content performance
Especially regarding recent high-profile releases and their impact on viewer engagement.
- Forward guidance
Any adjustment to revenue or profit projections could significantly impact the market's reaction to the earnings report, regardless of the Q1 performance itself.
- Password sharing updates
Netflix's efforts to crack down on password sharing, which began in earnest in 2023, will also be of interest. This initiative was designed to convert non-paying users into subscribers, and investors will want evidence that it continues to drive revenue growth.
- Regional performance breakdowns
Provide insight into where Netflix is seeing the strongest growth or facing the greatest challenges. Particular attention will be paid to performance in Asia-Pacific markets, which have been identified as key growth regions.
- Forex trading implications
Netflix derives substantial revenue internationally. Currency fluctuations can significantly impact reported results, with a weaker greenback potentially increasing international revenue when converted back to US dollars.
For investors using trading signals to inform their decisions, understanding the company’s share price evolution will be essential for interpreting the significance of the Q1 results.
Netflix technical analysis
Netflix's stock has experienced notable volatility in recent months, trading at $918.29 ahead of earnings, down up to 19% from a February peak of $1064.50. However, the broader picture remains positive, with shares having surged over 51% over the past 12 months, and trading up 3% year-to-date, reflecting strong investor confidence in the company's long-term prospects.
From a technical perspective, the long-term uptrend will stay intact as long as the January and current April lows at $823.52 to $821.10 hold on a weekly chart closing basis.
Netflix daily chart
