11:23 AM EDT, 07/18/2025 (MT Newswires) -- Netflix ( NFLX ) can sustain double-digit revenue growth through 2028 while expanding margins and generating a 25% compound annual growth rate in earnings per share, supported by gains in advertising and early advances in GenAI, Morgan Stanley said in a note Friday.

The firm said Netflix's ( NFLX ) new ad tech platform helped drive a strong upfront, with 2025 advertising revenue now expected to more than double from last year. GenAI tools are also beginning to contribute to content creation and product features, including new VFX capabilities and a conversational user interface.

Morgan Stanley raised its 2025 revenue forecast to a range of $44.8 billion to $45.2 billion, up from a prior range of $43.5 billion to $44.5 billion. Operating margins are expected to reach 30% on a reported basis, while free cash flow guidance increased to between $8.0 billion and $8.5 billion.

The firm also raised its earnings per share estimates by an average of 1% to 2% over the next three years, now assuming reported revenue growth of 15% to 16% in 2025. The firm said Netflix's ( NFLX ) disciplined execution and strong content pipeline support further margin expansion.

Morgan Stanley maintained its overweight rating on Netflix ( NFLX ) and increased its price target to $1,500 from $1,450.

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