Netflix is scheduled to release its Q1 2025 earnings on Thursday, April 17, 2025. According to consensus estimates, revenue is expected to rise by approximately 12% to around $10.5 billion, while earnings per share are projected to be about $5.73. This growth is anticipated to be fueled by Netflix’s robust subscriber additions throughout 2024—totaling over 40 million—and its recent price increases. In January, the company raised the standard HD plan by $2.50 to $18 per month and increased the Premium plan to $25 per month.
Netflix posted strong subscriber gains in 2024, driven by its crackdown on password-sharing and the growth of its ad-supported tier. However, this momentum could ease in 2025. Additionally, intensifying competition could contribute to elevated churn or slower growth in new subscriptions. Netflix’s decision to discontinue reporting subscriber figures might indicate that it expects growth to taper off this year.
Margins will also be a key focus this quarter. The company’s content expenses are set to climb as it expands further into live sports programming, including NFL games and WWE wrestling, which are typically higher-cost content segments.
Netflix currently holds a market capitalization of $404 billion. Over the past twelve months, the company generated $39 billion in revenue, with $10 billion in operating profit and $8.7 billion in net income. For investors looking for potential gains with reduced volatility compared to individual stocks, the Trefis High-Quality portfolio offers an appealing alternative, having surpassed the S&P 500 and returned over 91% since inception.
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Netflix’s Historical Odds Of Positive Post-Earnings Return
Some insights into one-day (1D) post-earnings returns:
- Over the last five years, there are 19 earnings reports, with 7 positive and 12 negative 1D returns, translating to a roughly 37% chance of a positive return.
- This percentage rises to 55% when considering only the last 3 years.
- The median of the 7 positive returns = 11%, while the median of the 12 negative returns = -6.7%.
More data on 5-Day (5D) and 21-Day (21D) post-earnings returns are summarized in the following table.
Correlation Between 1D, 5D, and 21D Historical Returns
A less risky strategy (provided correlation is significant) involves analyzing the relationship between short- and medium-term post-earnings returns. Identifying a highly correlated pair—such as 1D and 5D—allows traders to go “long” for 5 days if 1D returns are positive. Below is correlation data drawn from 5-year and 3-year histories. For instance, the metric 1D_5D indicates correlation between 1-day and 5-day post-earnings returns.
Learn more about the Trefis RV strategy, which has outperformed a blended benchmark of the S&P 500, S&P mid-cap, and Russell 2000, delivering robust returns to investors. For a smoother investment ride than an individual stock like Netflix, the High Quality portfolio is worth considering, having surpassed the S&P and delivered over 91% gains since inception.
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