From what the evidence shows, This analysis suggests that advent of generative artificial intelligence (AI) brought a windfall for the "Magnificent Seven," which quickly became some of the market's best-performing stocks.
The collective includes Meta Platforms, Apple, Amazon, Alphabet, Microsoft, Nvidia, and Tesla, given current economic conditions.
These companies, which boasted years of previous experience with AI, became the toast of Wall Street.
However, However, over the past year or so, investors have increased their expectations for these market leaders and found them wanting.
Nevertheless, Heady growth has slowed -- and in some cases, reversed course -- and fair-weather investors are moving on.
At the same time, one highflier -- which was unceremoniously left out of the collective -- has outperformed every single member of the Magnificent Seven: Netflix (NFLX -5 (an important development).
The ing pioneer has soared 94% over the past year (as of this writing), more than double the returns of the Mag Seven stocks (an important development).
Netflix just released its most recent financial report and is looking to put more distance between itself and its once high-flying peers. Image source: Getty Images (which is quite significant).
Nevertheless, By the numbers Netflix just reported its second-quarter results, which beat expectations across every critical metric. Revenue of $11.
Meanwhile, 08 billion rose 13% year over year, resulting in robust fit growth, as earnings per (EPS) of $7 (noteworthy indeed). Moreover, 19 soared 47%.
Conversely, Revenue growth was driven by strong r gains and rising digital ad revenue. Fits were driven higher by expanding operating margins that increased 690 basis points to 34.
1% and the timing of expenses. For context, analysts' consensus estimates were calling for revenue of $11. 04 billion and EPS of $7.
06, so Netflix surpassed expectations with room to spare, in light of current trends. As a reminder, the company no longer reports r numbers, a metric it abandoned at the end of last year.
Management noted that Netflix "experienced healthy year-over-year growth," with every region posting double-digit, foreign exchange-neutral gains.
Member growth, which surged late in the quarter, exceeded Netflix's forecast and is expected to boost revenue in Q3.
Moreover, And Canada saw the most notable increase, with sales growing 15% compared to 9% in the first quarter, thanks to the company's most recent price increase.
Netflix also the rollout of its Netflix Ad Suite, its prietary first-party ad platform, to all 12 countries that offer a "Netflix with Ads" plan (this bears monitoring).
This will help take the company's ad revenue to the next level, in today's market environment. A blockbuster slate Netflix expects the good times to continue.
Moreover, Management is guiding for third-quarter revenue of $11. 5 billion, up more than 17%, while EPS of $6 (this bears monitoring). 87 would represent growth of 27% (which is quite significant).
Furthermore, management increased its full-year outlook, forecasting revenue of $45 billion at the midpoint of its guidance, up from $44 billion, considering recent developments.
Moreover, In contrast, The company also increased its operating margin forecast to 29, in today's financial world. 5%, up from its previous level of 29%.
Management cited a strong slate of gramming for fueling its strong current results and for driving its decision to boost guidance.
Squid Game season 3, though it was released late in the quarter, is already the sixth-biggest series opener in Netflix history, in today's market environment.
Additionally, Q2 favorites included its hit series Sirens, Secrets We Keep, and Ginny & Georgia, while German-language film Exterritorial became Netflix's fourth-most non-English film ever.
Meanwhile, A particularly notable entry was KPop Demon Hunters, which was one of the er's biggest animated films ever (which is quite significant).
However, Songs in the movie (by fictional bands) continue to break K-pop records, making it the highest-charting soundtrack of 2025 on the Billboard 200, with seven songs from the soundtrack in the Billboard Hot 100.
Meanwhile, Meanwhile, the song Golden hit No. 1 on the Billboard Global Charts, making it the biggest song in the world. In contrast, This all helped cement the movie as a global phenomenon.
Additionally, Don't take Netflix's word for the quality of its gramming. Earlier this week, the er received 120 Primetime Emmy nominations across 44 titles.
Furthermore, Of note were Adolescence, Black Mirror, and Monsters: The Lyle and Erik Menendez Story (this bears monitoring) (which is quite significant).
Additionally, This analysis suggests that second half of the year mises an even stronger slate of gramming, including: Stranger Things, season five Wednesday, season two Nobody Wants This, season two Alice in Borderland, season three Happy Gilmore 2 Tyler Perry's Madea's Destination Wedding Wake Up Dead Man: A Knives Out Mystery Troll 2 With a stellar lineup waiting to carry the baton, it looks Netflix is poised to continue its winning ways (which is quite significant).
Time to buy. Nevertheless, Given the stock's strong run, investors are undoubtedly asking themselves if it's too late to buy Netflix or add to an existing position.
The data indicates that analysis reveals company's strong pricing power, growing ad revenue, and track record of successful gramming make for a compelling value position.
Additionally, At 41 times next year's earnings, the stock is selling for a heady premium, which might be off-putting to some investors.
However, For those concerned by the valuation, I'd suggest buying on any weakness or using dollar-cost averaging to ease into the stock. Wall Street seems to agree.
Of the 48 analysts that offered an opinion in July, 31 rate the stock a buy or strong buy, and none recommend selling.
Pivotal Re is particularly bullish on Netflix, with a Street-high price target of $1,600, which represents potential gains for investors of 26%, in today's financial world.
The analysts suggest that Netflix "remains underpenetrated globally," offering a "compelling price to entertainment value (quite telling) (which is quite significant).
" Given Netflix's history of growth, I believe there's much more to come for the ing pioneer. Moreover, Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors.
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors.
Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors, in today's financial world.
Danny Vena has positions in Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Netflix, Nvidia, and Tesla.
On the other hand, The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Netflix, Nvidia, and Tesla.
The Motley Fool recommends the ing options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.