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Netflix’s earnings are strong and stock price is expected to recover

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U.S. stocks were briefly up and down in early trading Thursday as investors watched Netflix (NFLX)’s earnings season get into full swing.

The S&P 500 (^GSPC) remained above the flatline and the Dow Jones Industrial Average (^DJI) rose about 0.5% after ending lower in the previous session. The Nasdaq Composite Index (^IXIC) was shaken by the recent weakness in tech stocks.

Stocks have struggled on concerns that inflation is no longer cooling and that the Federal Reserve may ease its rate cuts. For this reason, company earnings are in the spotlight as investors focus on how well reports match their lofty expectations.

TSMC (TSM)’s latest quarterly results were mixed. Taiwan’s leading chip company warned about this year’s growth outlook outside of its memory chip business, sending its stock price down more than 5%. However, the company showed an “insatiable” appetite for AI as it posted a higher than quarterly profit.

The focus of earnings has now shifted to Netflix, which is the first of the big tech companies to report. The streaming leader’s financial update later Thursday is being seen by some as the first real test for stocks this earnings season, with mega-cap stocks still playing a big role in pushing the market higher.

Meanwhile, given the possibility of a “no-landing” for the economy, the market is still paying close attention to the debate over whether the U.S. Federal Reserve (Fed) may decide not to cut interest rates this year.

US Treasury yields have recently fallen from five-month highs, easing pressure on stock prices. The 10-year US Treasury yield (^TNX) is hovering around 4.56%.

live4 updates

  • Tesla stock falls to 52-week low

    Tesla (TSLA) fell more than 3% in early trading Thursday as the EV giant’s stock continued its downward trend. Tesla stock has fallen about 40% since the beginning of the year, to its lowest intraday level since January 2023.

    The tech-heavy Nasdaq Composite Index (^IXIC) struggled to stay in the green zone after falling more than 1% earlier.

  • S&P 500 trying to end four-day losing streak

    Stocks rose on Thursday morning, led by gains in the three major averages.

    The Dow Jones Industrial Average (^DJI) rose 0.3% and the S&P 500 (^GSPC) rose about 0.2%. The Nasdaq Composite Index (^IXIC) rose 0.1% after tech stocks ended Wednesday down more than 1%.

    In each session so far this week, the S&P 500 has started higher but has been unable to maintain its gains throughout the day. The past four sessions have ended lower for the broader benchmark.

    All eyes will be on the world this afternoon as streaming giant Netflix (NFLX) releases its quarterly results after the closing bell.

    Netflix stock is up more than 25% since the beginning of the year.

  • The debate over Tesla continues

    Part of the fun in business newsrooms is the banter when battleground stocks are put through the wringer.

    Today, that hotly contested stock is none other than Tesla (TSLA). Tesla had a terrible 2024 for various reasons. Despite the company’s new cost cuts, the stock has fallen 11% over the past five trading sessions. The stock price has fallen nearly 40% since the beginning of the year.

    The joke from today’s Yahoo Finance newsroom premarket was how slow most people on the street are in changing direction in stocks. Some analysts have changed their ratings but maintain Hold.

    Yahoo Finance Live director Valentina Caval and reporter Madison Mills crunched the numbers on this, and here’s where it stands.

    Last year alone, more than 60% of analysts gave Tesla a buy rating, but now only 32% of analysts have the same rating for Tesla stock. Approximately 44% have a Hold rating and 23% have a Sell rating.

  • And the US debt warning continues – Bank of America’s CEO also weighs in

    The IMF caused a stir this week at its spring meeting in Washington, D.C., by warning about the high level of U.S. debt (more than $34 trillion).

    Amid these warnings, we’ve seen interest rates on 2-year and 10-year U.S. Treasuries rise, giving momentum stocks such as Nvidia (NVDA) some air.

    Bank of America Chairman and CEO Brian Moynihan is joining the conversation about U.S. debt with a new interview with Truly You.

    “So we’ve got to keep debt at a reasonable level. And we’re OK now, but that’s something we have to worry about,” Moynihan told me on Yahoo Finance. “This isn’t about ringing the alarm bells and saying we have to stop everything starting tomorrow. This is something we have to manage over the next 10 years. Doing a little bit every year will lead to big things at the end of the decade. Because it becomes something.”

    Check out our chat about other issues, including the current state of U.S. consumers, below. And here’s further analysis of the company’s earnings this week.



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