Core Viewpoint - Long-term investors may find an opportunity to purchase Netflix stock at a discount following a recent earnings miss due to a one-off tax issue, with the stock currently trading 18% below its record high from earlier this year [2] Financial Performance - Netflix reported a record revenue of $11.5 billion in Q3 2025, marking a 17.2% increase year-over-year, representing the fastest growth rate in four years [7] - The company generated earnings of $5.87 per share, falling short of analysts' expectations of $6.97, attributed to an unexpected tax dispute with the Brazilian government [8] - Over the last four quarters, Netflix has generated a net income of $10.4 billion, allowing it to invest heavily in content [9] Subscriber and Revenue Growth - Netflix has over 300 million members as of the end of 2024, maintaining a lead over competitors like Amazon Prime and Disney+ [4] - The advertising subscription tier, priced at $7.99 per month, has been a significant growth driver, accounting for over half of new signups in available markets [5] - Advertising revenue doubled in 2024 and is projected to more than double again in 2025, enhancing the value of each subscriber over time [6] Content Strategy - Netflix plans to spend around $18 billion on new shows and movies in 2025, with a growing focus on live content, particularly live sports [10] - The exclusive live-streaming of high-profile boxing matches and NFL games has attracted significant viewership, with the Canelo Álvarez vs. Terence Crawford fight drawing 41 million viewers [12][13] Investment Considerations - Netflix's stock is currently trading at a P/E ratio of around 47, significantly higher than the Nasdaq-100's P/E ratio of 33.1, indicating a premium valuation [14] - Analysts project earnings growth to $32.35 per share by 2026, which would lower the forward P/E ratio to approximately 34, aligning it more closely with the Nasdaq-100 [15][17] - Long-term investors may find the current stock price attractive for potential gains over a three to five-year horizon [17]