Netflix reports third-quarter adjusted earnings of $5.87 a share, missing Wall Street estimates of $6.96 a share. ...

Core Insights - "KPop Demon Hunters" is the most-watched film in Netflix's history with 325 million views and was the first Netflix movie to top the box office chart during its limited theatrical release [1] - Netflix's third-quarter revenue rose to $11.5 billion, with net income totaling $2.5 billion, reflecting an increase from $2.36 billion in the same quarter of 2024 [4] - The company is on track to double its sales by 2025, despite a drop in overall operating margin from an expected 31% to 28% due to a dispute with Brazilian tax authorities [3][4] Revenue and Viewership - The third-quarter slate helped Netflix achieve a record share of television time in the U.S. and Britain, with significant viewership for events like the live super middleweight bout between Terence Crawford and Canelo Alvarez, attracting over 41 million viewers globally [2] - The success of "KPop Demon Hunters" has led to high demand for its soundtrack and character costumes, and the company has announced a deal with Mattel and Hasbro for related merchandise starting in 2026 [1] Strategic Shifts - Netflix is diversifying its entertainment offerings, including a podcast deal with Spotify and a new gaming strategy aimed at encouraging group play [7] - The company is pivoting its content strategy to include more live sports, YouTubers, creators, and podcasters to enhance viewer engagement and grow its advertising business [10] Competitive Landscape - Netflix faces competition from Paramount Pictures, which is attracting talent with substantial budgets and theatrical releases, as well as from YouTube and Amazon Prime Video, which are expanding their offerings [5][6] - Analysts express concerns that Netflix's focus on non-core business strategies, such as podcasting and gaming, may dilute its core content quality, potentially impacting its leading status in the streaming market [8][9]

Core Viewpoint - The analysis indicates that while Netflix maintains solid quality, the potential for significant upside appears limited, leading to a rating downgrade [1]. Company Analysis - Netflix is currently being priced by the market as a solid company, but the growth potential is perceived to be thin [1]. - The analysis emphasizes a fundamental approach to evaluating Netflix, focusing on its valuation and growth prospects [1]. Market Context - The report reflects a broader perspective on the financial market, highlighting the importance of identifying undervalued stocks with growth potential [1].

Corporate Developments and Analyst Insights - JPMorgan has reduced its price target for Netflix (NFLX) to $1,275, maintaining a neutral rating while balancing long-term optimism with cautious near-term outlook following stock rallies [2][10] - Jefferies has raised its price target for Intuitive Surgical (ISRG) to $560 from $550, following previous adjustments and citing tariff impacts on gross margins [3] - Piper Sandler has also increased its target for Intuitive Surgical to $595 from $575, driven by strong second-quarter performance and raised full-year procedure guidance [3] - Advent International is reportedly exploring a $2 billion sale of its Parfums De Marly business [4] Geopolitical and Policy Landscape - Efforts are ongoing to restore external power to Ukraine's Zaporizhzhia Nuclear Power Plant, with both Russian and Ukrainian forces cooperating to establish ceasefire zones for repairs, highlighting persistent safety risks [5][10] - Japan is set to unveil a new economic package focusing on counter-inflationary measures, growth investment, and national security, including potential tax cuts and expanded subsidies [6][10] - The U.S. pharmaceutical industry faces significant policy threats as a price probe raises the possibility of new drug tariffs, which could lead to higher domestic prices and potential drug shortages [7][10] - The UK Treasury is expected to address tax loopholes for online giants as part of broader efforts to tackle fiscal challenges [8] - Sweden's Prime Minister and Ukraine's President are scheduled for a joint visit, focusing on military aid and reconstruction as part of a bilateral security cooperation agreement [9] Market Performance and Trends - Global equity markets are showing signs of recovery, with Nasdaq futures gaining 0.11% and S&P 500 futures rising 0.18%, indicating a cautious recovery in equity markets [11][10] - The USD/JPY pair has stabilized at 151.835, influenced by the Bank of Japan's monetary policy and Japan's economic outlook [11][10] - Thailand's financial markets are experiencing inflows into bonds and stock funds, attributed to a weakening U.S. dollar and attractive valuations in Thai equities [12]

Core Insights - Netflix faced an unexpected $619 million tax expense from Brazil, significantly impacting its operating margin for the September quarter, leading to a stock decline of over 6% [1] Financial Performance - The operating margin reported for Q3 was 28%, which would have exceeded the company's guidance of 31.5% without the Brazilian tax issue [2] - The tax expense was attributed to a national tax on outbound payments known as the Contribution for Intervention in the Economic Domain (CIDE) [2][3] Tax Implications - The tax involves a 10% levy on certain payments made by Brazilian entities to companies outside Brazil, affecting not only Netflix but potentially other companies as well [3] - Netflix Brazil pays Netflix U.S. for services that enable subscription offerings in Brazil, and a favorable ruling from a lower court in 2022 had previously led the company to believe it was not subject to this tax [4] Legal Context - A recent ruling by the Brazil Supreme Court indicated that the tax applies to a broader range of transactions than previously thought, prompting Netflix to reevaluate its legal standing and record the tax expense in Q3 [5] - Approximately 20% of the recorded tax expense is related to 2025 [5]

For the quarter ended September 2025, Netflix (NFLX) reported revenue of $11.51 billion, up 17.2% over the same period last year. EPS came in at $5.87, compared to $5.40 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $11.52 billion, representing a surprise of -0.12%. The company delivered an EPS surprise of -14.8%, with the consensus EPS estimate being $6.89.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street ...

David Joyce, Seaport Research Partners Senior Analyst, says the stock is overreacting as the quarter was better than expected. He tells Katie Greifeld and Romaine Bostick on "The Close" that the company is making solid progress on advertising. ...

Netflix (NFLX) reported earnings that missed analyst expectations on both revenue and profit, sending shares over 8% lower in trading on Wednesday. Netflix reported revenue of $11.51 billion, just shy of Bloomberg consensus estimates of $11.52 billion and slightly below the company’s own guidance of $11.53 billion. That compares to $9.82 billion in the same quarter last year. Earnings per share came in at $5.87, missing analyst expectations of $6.94 and Netflix’s internal forecast of $6.87, though still ...

Core Viewpoint - The company is facing challenges despite beating earnings and revenue expectations, with concerns about margin deterioration and potential future growth slowing down due to market saturation and tax issues [1][3][12]. Financial Performance - The company reported earnings and revenue beats, but the stock price declined by 5%, indicating market skepticism about future growth prospects [1][2]. - There is a noted deterioration in margins, particularly in guidance, which may be influenced by tax issues [3][6]. Market Position and Growth Strategy - The company may need to pursue growth through acquisitions, as organic growth appears to be slowing [4][12]. - The international market is expected to be a key area for incremental growth, but this may require higher content spending and tailored content strategies [13]. Advertising and Engagement - The company has successfully doubled its advertising numbers, although this comes from a lower base, raising questions about sustainable growth [9]. - AI and machine learning are seen as tools that could enhance content generation and viewer engagement, potentially offsetting some growth concerns [8]. Tax Issues - The Brazilian tax dispute is highlighted as a significant concern, with potential implications for future tax issues in other regions, which could affect overall profitability [12][14]. - Even if the Brazilian tax issue is considered a one-off, there are worries about similar tax challenges arising in other markets [14].

Gold fell 6% on Tuesday, its largest decline since August 2020 and second biggest since 2013. After such a steep ascent - its year-to-date gain last week was almost 70% - the inevitable question now is: correction, or crash?That may reflect over-confidence, or complacency. The mood at the IMF/World Bank meetings in Washington last week was far less upbeat, with the recent escalation around rare earths and 100% tariffs marking a new and worrying phase. Markets are priced for significant de-escalation, and if ...