📈 Netflix's Earnings Feast

Good morning.

U.S. Markets are closed today, Good Friday, and will re-open on Monday.

We want to thank you for being a loyal subscriber of Bull Street. Our next edition will go out on Tuesday, and we have a major announcement about the future of Bull Street. Enjoy a blessed weekend and we will see you next week after the markets re-open.

⚡ The Fast Five → Nvidia CEO makes surprise China visit, Palantir stock tries to breakout, UnitedHealth shares tumble, Judge rules Google operates ad monopoly, Netflix posts major earnings beat

🔎 Market Trends → Wall Street choppy as Eli Lilly jumps, UnitedHealth plummets; US Futures Trade Mostly Higher

And now…

⏱️ Your 5-minute briefing for Friday, April 18, 2025:

MARKET BRIEF
Before the Open

Pre-Market

Fear & Greed

Markets in Review

Lilly Lifts, But Wall Street Ends Week with a Wobble

The Dow slipped 1.3% to 39,142.2, while the Nasdaq dipped 0.1% to 16,286.5, both logging a third straight day of losses. The S&P 500 eked out a 0.1% gain to 5,282.7, buoyed by strength in pharma and financials.

The Big Picture:

Markets wrapped a holiday-shortened week on shaky ground, weighed by earnings misses and geopolitical crosswinds. But beneath the surface, key bright spots pointed to pockets of resilience, especially in biotech and energy.

UnitedHealth’s (UNH) disappointing quarter dragged on health care sentiment, but Eli Lilly (LLY) offered a bullish counterweight with a promising update on its obesity pill pipeline—a space expected to see exponential growth.

Meanwhile, oil prices surged 3.1% to $64.43, hitting two-week highs on fresh U.S. sanctions against Iran, which raised supply concerns. Treasury yields also moved up, with the 10-year rate rising 4.8 bps to 4.33%, showing bond traders still see growth—even amid uncertainty.

Market Movers:

• Eli Lilly (LLY) soared 14%, leading the S&P 500, after reporting strong trial data showing its new obesity pill improves both weight loss and glucose control.

• UnitedHealth (UNH) plunged 22%, after slashing its full-year outlook and missing Q1 expectations. Management pledged a return to its long-term earnings growth target.

• Global Payments (GPN) dropped 17% on plans to acquire Worldpay for $24.25B while offloading its issuer solutions unit. Investors showed hesitation over deal complexity.

What They’re Saying:

“We’re addressing challenges aggressively to return to our long-term earnings growth rate,” said UnitedHealth CEO Andrew Witty, after the stock's steepest drop in over a decade.

WHAT WE’RE WATCHING
Events

• There are no events scheduled for today.

Earnings Reports

• Today: Progressive, HDFC Bank, Sify Technologies, Park National Bank

• Monday: W.R. Berkley Corporation, Bank of Hawaii, Comerica, Western Alliance Bancorporation, Zions Bancorporation

MARKET BRIEF
Leading News

Netflix's Earnings Feast: Why This Streaming Giant Still Has Room to Run (NFLX)

Why it matters:

Netflix's stellar Q1 performance demonstrates that premium content providers can still command pricing power even in today's uncertain economic landscape.

Zoom Out:

The streaming pioneer delivered a 13% revenue surge to $10.54 billion in Q1, handily beating Wall Street's expectations alongside earnings of $6.61 per share — crushing estimates of $5.71. This comes as Netflix shifts investor focus from subscriber counts to financial fundamentals, a sign of growing maturity.

Perhaps most telling is what didn't happen: despite recent price hikes across all subscription tiers (standard plan now $17.99, up from $15.49), revenue growth actually accelerated. This suggests the company's content moat remains formidable enough to withstand pricing elasticity tests that would sink lesser competitors.

Key Insights:

• The advertising pivot is beginning to bear fruit, with Netflix launching its in-house ad tech platform in April. History suggests media companies that control both content and distribution channels tend to capture outsized economics — think Disney in its prime before the streaming wars.

• Recession-resistant qualities are emerging. Co-CEO Greg Peters noted entertainment has "historically been pretty resilient in tougher economic times," a particularly valuable trait as market participants grow anxious about potential trade policy impacts.

• Profit margins continue expanding, with net income jumping 24% year-over-year to $2.89 billion, suggesting the company is finally reaping the rewards of its massive content investments.

Market Pulse:

"We take some comfort that entertainment historically has been pretty resilient in tougher economic times," noted Peters, offering a reminder that quality escapism remains in demand regardless of economic cycles.

Bull’s Take:

Smart investors should consider that while content costs remain substantial, Netflix has demonstrated rare pricing power in an inflation-sensitive environment. The company that once disrupted Blockbuster has now become the defensive stalwart of the streaming era.

Headlines

• Nvidia’s CEO makes surprise visit to Beijing after US restricts chip sales to China (link)

• Palantir Stock Tries To Break Out As NATO Win Dispels Tariff Jitters; Earnings Next (link)

• UnitedHealth Shares Tumble After Earnings Fall Short Due to Medicare Issues (link)

• Eli Lilly says GLP-1 pill for diabetes and weight loss effective in study, plans to seek FDA approval (link)

• Investor Bill Ackman Confirms 20% Stake in Hertz Stock (HTZ) and Teases Uber Partnership (link)

• Judge Rules Google Operates Illegal Ad Monopoly (link)

CRYPTO
Fear & Greed

Headlines

• 4 reasons why Bitcoin price could rally to $90K in April (link)

• Arizona leads crypto reserve legislation race as SB 1373 passes House committee (link)

• Solana Surges 4.5% as Canada Launches First Spot ETFs (link)

DAILY SHARE
On the Socials