ZACKSยท2025-08-19 13:40Core Insights - The streaming industry is experiencing intense competition, leading companies to invest heavily in exclusive content to differentiate themselves and capture market share [2][3] Company Performance - Netflix Inc. reported second-quarter 2025 adjusted earnings of $7.19 per share, exceeding estimates by 1.7% and showing a 47.3% increase year-over-year. Revenues reached $11.07 billion, a 16% year-over-year increase, driven by membership growth and higher subscription pricing [6][8] - The Walt Disney Co. reported third-quarter fiscal 2025 adjusted earnings of $1.61 per share, beating estimates by 10.3% and increasing 15.8% year-over-year. Revenues rose 2.1% year-over-year to $23.6 billion, slightly missing estimates by 0.1% [13][14] Subscriber Growth - Netflix's subscriber growth was bolstered by the success of "Squid Game S3," which garnered 122 million views shortly after release. The company also launched its Ad Suite, which is expected to enhance subscriber and average revenue per user (ARPU) growth [7][10] - Disney+ reached 127.8 million subscribers, with a sequential increase in average monthly revenue per paid subscriber to $8.09 domestically and $7.67 internationally [14][15] Future Guidance - Netflix raised its full-year 2025 revenue forecast to $44.8-$45.2 billion, driven by member growth and advertising revenue expectations [10] - Disney anticipates a total increase of over 10 million subscriptions for Disney+ and Hulu in the fourth quarter of fiscal 2025, with adjusted earnings per share projected at $5.85, an 18% increase over fiscal 2024 [17][18] Estimate Revisions - For Netflix, the Zacks Consensus Estimate for 2025 shows revenues of $45.03 billion and earnings per share of $26.06, reflecting year-over-year increases of 15.5% and 31.4%, respectively [11][12] - For Disney, the Zacks Consensus Estimate for fiscal 2025 indicates revenues of $94.91 billion and earnings per share of $5.85, representing year-over-year improvements of 3.9% and 17.7%, respectively [20][21]