We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Will Netflix Stock Reach New Heights as Q3 Earnings Approach?
Ten percent from its 52-week and all-time high of $1,341 a share, Netflix stock is sitting on impressive gains of more than +30% this year.
Holding down the title of subscriber king ahead of Amazon's Prime Video and Disney's Disney+, market sentiment has remained high for NFLX, with Netflix now boasting over 300 million paid subscribers worldwide.
Known for having sharp post-earnings swings in either direction, investors may wonder if Netflix stock is poised to reach new heights or if a selloff could be in the cards as its Q3 report approaches on Tuesday, October 21.
Strategic Expansion & Blazing Ad Growth
Embarking on new monetization avenues, Netflix has continued to diversify its streaming services with live sports and advertising.
More intriguing, Netflix is making a push into the $100+ billion gaming market through interactive cloud gaming and TV integration. Turning its streaming service into a gaming console, Netflix now allows users to play games directly on their TV screens. Netflix's initial gaming strategy includes party-style games designed to enhance social engagement through group play.
Ad-Tech:Investing heavily in generative AI to streamline and personalize game creation, Netflix has also modularized its AI ad formats, which has helped double its ad revenue while reducing reliance on price hikes. These immersive AI ads appear directly inside hit shows like Stranger Things and Wednesday with Netflix using gen AI to create deeper brand integration without traditional product placement.
Netflix's more affordable ad-supported tier has grown to nearly 100 million subscribers and now accounts for 50% of its new subscriptions. Furthermore, Netflix's ad revenue has already soared over 120% this year to more than $3 billion after more than doubling in 2024 as well.
International Audiences:Increasing its presence in Asia-Pacific and Europe, Netflix has built its cultural relevance by leveraging local storytelling to appeal to diverse audiences with regional hit shows like Tokyo Ghoul and Delhi Crime.
Netflix's Q3 Expectations
Zacks' projections call for Netflix's Q3 sales to be up 17% to $11.52 billion compared to $9.82 billion in the prior year quarter. Taking advantage of its top-line expansion, Netflix's earnings are expected to climb 27% to $6.89 per share versus EPS of $5.40 in Q3 2024.
NFLX Price Target
Reflecting strong confidence in its growth trajectory, analysts have remained moderately bullish on Netflix stock, with the current Average Zacks Price Target of $1,338 suggesting 13% upside for NFLX. Notably, the street-high price target of $1,600 suggests 35% upside, while the low of $800 reflects 32% downside.
What the Zacks Rank Suggests
Most influential to Zacks' proprietary ranking system is the trend of earnings estimate revisions (EPS), with NFLX currently landing a Zacks Rank #3 (Hold). Over the last quarter, EPS estimates for NFLX have remained positive, but the needle hasn't moved much for fiscal 2025 or FY26 projections.
That said, Netflix's annual earnings are now expected to soar 31% in FY25, with FY26 EPS projected to spike another 23% to $32.27.
Conclusion & Final Thoughts
Netflix's massive earnings potential does justify its premium to the broader market at a forward P/E multiple of 45X. Although Netflix has continued to grow into what was a much loftier valuation, its Q3 report will need to reconfirm the company's enticing outlook.
Considering the YTD gains for NFLX and that it is now up nearly +400% in the last three years, a selloff could be spurred by any disappointment or profit taking if the results are not overwhelming. On the other hand, if Netflix wows with financial results, NFLX could certainly see a post-earnings rally and even hit new heights on promising guidance that reflects its compelling strategic expansion.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.
Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Zacks Investment Ideas feature highlights: Netflix, Amazon and Disney
For Immediate Release
Chicago, IL – October 20, 2025– Today, Zacks Investment Ideas feature highlights Netflix (NFLX - Free Report) , Amazon (AMZN - Free Report) and Disney (DIS - Free Report) .
Will Netflix Stock Reach New Heights as Q3 Earnings Approach?
Ten percent from its 52-week and all-time high of $1,341 a share, Netflix stock is sitting on impressive gains of more than +30% this year.
Holding down the title of subscriber king ahead of Amazon's Prime Video and Disney's Disney+, market sentiment has remained high for NFLX, with Netflix now boasting over 300 million paid subscribers worldwide.
Known for having sharp post-earnings swings in either direction, investors may wonder if Netflix stock is poised to reach new heights or if a selloff could be in the cards as its Q3 report approaches on Tuesday, October 21.
Strategic Expansion & Blazing Ad Growth
Embarking on new monetization avenues, Netflix has continued to diversify its streaming services with live sports and advertising.
More intriguing, Netflix is making a push into the $100+ billion gaming market through interactive cloud gaming and TV integration. Turning its streaming service into a gaming console, Netflix now allows users to play games directly on their TV screens. Netflix's initial gaming strategy includes party-style games designed to enhance social engagement through group play.
Ad-Tech:Investing heavily in generative AI to streamline and personalize game creation, Netflix has also modularized its AI ad formats, which has helped double its ad revenue while reducing reliance on price hikes. These immersive AI ads appear directly inside hit shows like Stranger Things and Wednesday with Netflix using gen AI to create deeper brand integration without traditional product placement.
Netflix's more affordable ad-supported tier has grown to nearly 100 million subscribers and now accounts for 50% of its new subscriptions. Furthermore, Netflix's ad revenue has already soared over 120% this year to more than $3 billion after more than doubling in 2024 as well.
International Audiences:Increasing its presence in Asia-Pacific and Europe, Netflix has built its cultural relevance by leveraging local storytelling to appeal to diverse audiences with regional hit shows like Tokyo Ghoul and Delhi Crime.
Netflix's Q3 Expectations
Zacks' projections call for Netflix's Q3 sales to be up 17% to $11.52 billion compared to $9.82 billion in the prior year quarter. Taking advantage of its top-line expansion, Netflix's earnings are expected to climb 27% to $6.89 per share versus EPS of $5.40 in Q3 2024.
NFLX Price Target
Reflecting strong confidence in its growth trajectory, analysts have remained moderately bullish on Netflix stock, with the current Average Zacks Price Target of $1,338 suggesting 13% upside for NFLX. Notably, the street-high price target of $1,600 suggests 35% upside, while the low of $800 reflects 32% downside.
What the Zacks Rank Suggests
Most influential to Zacks' proprietary ranking system is the trend of earnings estimate revisions (EPS), with NFLX currently landing a Zacks Rank #3 (Hold). Over the last quarter, EPS estimates for NFLX have remained positive, but the needle hasn't moved much for fiscal 2025 or FY26 projections.
That said, Netflix's annual earnings are now expected to soar 31% in FY25, with FY26 EPS projected to spike another 23% to $32.27.
Conclusion & Final Thoughts
Netflix's massive earnings potential does justify its premium to the broader market at a forward P/E multiple of 45X. Although Netflix has continued to grow into what was a much loftier valuation, its Q3 report will need to reconfirm the company's enticing outlook.
Considering the YTD gains for NFLX and that it is now up nearly +400% in the last three years, a selloff could be spurred by any disappointment or profit taking if the results are not overwhelming. On the other hand, if Netflix wows with financial results, NFLX could certainly see a post-earnings rally and even hit new heights on promising guidance that reflects its compelling strategic expansion.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.
Today you can access their live picks without cost or obligation.
See Stocks Free >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.