Can NFLX sustain its EPS growth in 2025?

Netflix (NFLX) is poised to sustain its EPS growth in 2025, driven by several key factors:

1. **Strong Financial Performance**: Netflix's recent financial results are impressive, with a reported EPS of $4.28 for the fourth quarter of 2024, marking a 102.7% year-over-year growth. This robust performance sets a solid foundation for continued EPS growth in the coming year.

|code|Ticker|Name|Date|Diluted EPS YoY|market_code|
|---|---|---|---|---|---|
|NFLX|NFLX.O|Netflix|2024 Q1|83.33333333333334|185|
|NFLX|NFLX.O|Netflix|2024 Q2|48.32826747720364|185|
|NFLX|NFLX.O|Netflix|2024 Q3|44.772117962466496|185|
|NFLX|NFLX.O|Netflix|2024 Q4|102.70142180094788|185|

2. **Revenue Growth Projections**: The company projects revenue growth of 12% to 14% for 2025, reaching between $43.5 billion and $44.5 billion. This growth in revenue is a critical indicator of increased profitability, which should translate into higher EPS.
3. **Strategic Initiatives**: Netflix plans to strengthen its core business by producing more content that resonates with viewers while expanding its ads business. These initiatives are expected to increase revenue per user and improve monetization, thus supporting EPS growth.
4. **Subscriber Growth**: The company has experienced significant subscriber growth, with a record-breaking net addition of nearly 19 million paid subscribers in the fourth quarter. This trend is expected to continue, which will lead to increased revenue and potentially higher EPS.
5. **Analyst Confidence**: The average analyst price target for Netflix is $1042.03, with a consensus rating of "Buy". This optimism among analysts suggests that they expect Netflix to maintain its growth trajectory, which includes EPS growth.
6. **Share Buybacks**: Netflix's board has approved an increase of $15 billion for share repurchases, indicating confidence in its future growth prospects. Share buybacks can enhance EPS growth by reducing the number of shares outstanding.
7. **Operational Efficiency**: Netflix's ability to sustain profitability while continuing to invest in original content highlights its operational efficiency. This efficiency is likely to translate into sustained EPS growth.

In conclusion, Netflix's strong financial performance, revenue growth projections, strategic initiatives, subscriber growth, analyst confidence, share buybacks, and operational efficiency all point to the company's ability to sustain its EPS growth in 2025.