Netflix heads into its first-quarter earnings in a stronger strategic position, with investor focus shifting back to fundamentals after recent moves to streamline its narrative, according to market commentary from eToro.
Josh Gilbert, market analyst at eToro, said the company’s decision to abandon a potential acquisition of Warner Bros. Discovery in March removed a key overhang, while the resumption of its share buyback programme and recent U.S. price increases have improved sentiment.
“Netflix is heading into this earnings season with a cleaner narrative,” Gilbert said, noting investor attention can now return to growth drivers.
Netflix has forecast first-quarter revenue of $12.16 billion, representing about 15 percent year-on-year growth, with earnings per share expected at $0.76. For the full year, the company projects revenue between $50.7 billion and $51.7 billion, alongside an operating margin of 31.5 percent, up from 29.5 percent in 2025.
The company’s previous earnings disappointed analysts, particularly on forward guidance, increasing scrutiny on the upcoming results.
“With $20 billion earmarked for content spend this year, the market will be looking closely at whether Netflix can sustain growth without eroding profitability,” Gilbert said.
Investors are also expected to focus on Netflix’s advertising business, which is emerging as a key second revenue stream. After surpassing 325 million subscribers last quarter, the company saw advertising revenue more than double in 2025 to about $1.5 billion and expects it to double again to $3 billion this year.
“Advertising is quickly becoming a critical second revenue engine for Netflix,” Gilbert said, adding that continued momentum in the ad-supported tier could support higher-margin growth beyond subscriptions.
With the Warner deal no longer in play, buybacks resumed and advertising scaling, Netflix has an opportunity to reinforce its leadership in the streaming sector, Gilbert said.
“This is a pivotal quarter for Netflix to remind the market why it continues to lead the streaming space,” he added.
