Earnings Beat: Netflix, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

It's been a good week for Netflix, Inc. (NASDAQ:NFLX) shareholders, because the company has just released its latest quarterly results, and the shares gained 6.1% to US$988. It looks like a credible result overall - although revenues of US$11b were in line with what the analysts predicted, Netflix surprised by delivering a statutory profit of US$6.61 per share, a notable 17% above expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Netflix after the latest results.

We've discovered 1 warning sign about Netflix. View them for free.

After the latest results, the 47 analysts covering Netflix are now predicting revenues of US$44.4b in 2025. If met, this would reflect a notable 11% improvement in revenue compared to the last 12 months. Per-share earnings are expected to step up 17% to US$25.46. In the lead-up to this report, the analysts had been modelling revenues of US$44.3b and earnings per share (EPS) of US$24.71 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

View our latest analysis for Netflix

The consensus price target was unchanged at US$1,094, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Netflix, with the most bullish analyst valuing it at US$1,514 and the most bearish at US$710 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Netflix's growth to accelerate, with the forecast 14% annualised growth to the end of 2025 ranking favourably alongside historical growth of 11% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.8% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Netflix to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Netflix following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Netflix going out to 2027, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for Netflix you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.