When it comes to storytelling, Netflix (NFLX) is in a league of its own. On Tuesday, January 20, the streaming giant reported strong fourth-quarter 2025 results, keeping investors interested in more than just its hit shows and movies.
The main conclusion of the results report was the scale. Netflix now has 325 million paid subscribers and a global audience approaching one billion viewers, marking a new milestone for the company. Looking to 2026, management aims to expand both the breadth and quality of its series and films, driving engagement, retention and long-term pricing power.
However, the much-discussed pending deal with Warner Bros. Discovery (WBD) could push Netflix beyond its core strengths, leading management to temporarily suspend share buybacks to preserve cash for the transaction. With a competitive bid from Paramount (PSKY) raising the risk of a costly bidding war, investor caution remains justified.
To that end, co-CEOs Ted Sarandos and Greg Peters remain confident, arguing that the acquisition would accelerate streaming growth and expand Netflix’s presence in television and theatrical films. With 325 million paid subscribers reaffirming Netflix’s vision every month, long-term believers have a compelling reason to continue investing.
Netflix, headquartered in Los Gatos, California, is a global entertainment platform. With a market capitalization of nearly $361 billion, the company acquires, licenses and produces original programming while offering paid memberships in more than 190 countries and countless genres.
The stock’s momentum has faltered recently, falling 29% over the past six months and 10% over the past month.
Sector comparisons add context. The State Street Communication Services Select Sector ETF SPDR (XLC) has gained nearly 8% over the past year and is down less than 1% over the past month.
NFLX stock currently trades at 27 times forward adjusted earnings, a premium to its industry peers. However, relative to its own five-year average multiple, the stock is now at a discount, suggesting a good entry point into the stock.
