Netflix's Q3 earnings miss on Brazil tax but deliver record ad sales, highest-ever engagement. KPop Demon Hunters becomes the most-watched film as AI strategy accelerates.
Netflix is a "Buy" after Q3 sell-off, as non-recurring Brazil tax and FX issues overshadow strong fundamentals and upgraded guidance. NFLX raised full-year guidance, reported record engagement, and continues to expand its content and advertising strategies for sustained long-term growth. Valuation is not cheap, but projected 13%+ revenue and 20%+ EPS growth support a 20% upside with a $1,380 price target.
Netflix missed Wall Street's third-quarter earnings targets because of an unexpected expense from a dispute with Brazilian tax authorities, while it offered a forecast a touch ahead of Wall Street projections for the rest of the year.
Netflix shares dropped Tuesday after the streaming giant released lackluster third quarter earnings. Bloomberg's Felix Gillette says that things are going well for Netflix within programming, despite the financial impacts of a costly tax dispute in Brazil.
At the moment, analysts have an average price target of $1,344.19 on NFLX. Piper Sandler just initiated an overweight rating on Dell (NYSE: DELL).
Netflix (NFLX) shares tumbled in premarket trading Wednesday after the streaming giant 's third-quarter earnings came in short of Wall Street expectations.
Netflix, Inc. faced a one-time $619 million Brazilian tax expense, dropping Q3 operating margin to 28% and causing a 7% stock decline. Despite the margin hit, NFLX delivered strong 17.2% revenue growth, record engagement, and robust free cash flow, with fundamentals remaining solid. Q4 guidance projects $11.96 billion revenue and a 23.9% margin, likely reflecting continued tax impact and seasonality, but not operational weakness.
Netflix reports third-quarter adjusted earnings of $5.87 a share, missing Wall Street estimates of $6.96 a share.
Netflix delivered solid Q3 results, but high market expectations and an EPS miss led to a 6% stock decline. NFLX's margin pressures and increased investment in content and marketing raise concerns about sustaining high profitability while pursuing growth. Optional growth avenues like ads and new product lines offer potential, but their uncertain impact shouldn't be factored into NFLX's valuation.
China says countries should take a "proactive role" in stabilizing their rare earths supplies. Netflix's third-quarter earnings missed expectations because of an ongoing dispute with Brazilian tax authorities.
An unexpected and painful $619 million tax expense from Brazil knocked the operating margin for Netflix' September quarter, defying Wall Street's upbeat guidance and hitting the stock, which fell more than 6%. It was unusual.
Netflix, Inc. (NASDAQ:NFLX ) Q3 2025 Earnings Call October 21, 2025 4:45 PM EDT Company Participants Spencer Wang - Vice President of Finance, Corporate Development & Investor Relations Gregory Peters - Co-CEO, President & Director Theodore Sarandos - Co-CEO, President & Director Spencer Neumann - Chief Financial Officer Presentation Spencer Wang Vice President of Finance, Corporate Development & Investor Relations Good afternoon, and welcome to the Netflix Q3 2025 Earnings Interview. I'm Spencer Wang, VP of Finance, IR and Corporate Development.