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The second-quarter 2025 earnings season is in full swing, with this week being the first big one this reporting cycle. So far, earnings results have come in better than expected. A few U.S. corporate bigwigs have already reported their quarterly financial numbers.
Some of these stocks have seen solid earnings estimate revisions for the second half of this year and next year after beating second-quarter estimates. This is significant as positive earnings estimate revisions indicate that market participants are expecting these companies to perform better in the rest of 2025.
At this stage, investment in these stocks should be prudent going forward. Five such stocks with a favorable Zacks Rank are: JPMorgan Chase & Co. JPM, Netflix Inc. NFLX, The Progressive Corp. PGR, GE Aerospace GE and Interactive Brokers Group Inc. IBKR.
Each of our picks currently sports a Zacks Rank #1 (Strong Buy), indicating solid price upside in the near term. You can see the complete list of today’s Zacks #1 Rank stocks here.
JPMorgan Chase came up with quarterly adjusted earnings of $4.96 per share, beating the Zacks Consensus Estimate of $4.51 per share. JPM posted revenues of $44.91 billion, surpassing the Zacks Consensus Estimate of $43.81 billion.
JPM’s business expansion initiatives, loan demand and relatively high interest rates should drive net interest income (NII) growth. While normal deal-making activity is tied to the health of the economy, JPMorgan's solid pipeline and leadership have generated continued growth in the investment banking business thus far.
Management now projects NII to be approximately $95.5 billion following solid first-half performance and higher yields. Earlier, the company anticipated NII to reach almost $94.5 billion. JPM expects non-interest expenses of $95.5 billion. It emphasized the importance of artificial intelligence (AI) in boosting efficiency and noted that its technology budget is $18 billion this year, up roughly 6% from last year.
JPMorgan Chase has an expected revenue and earnings growth rate of -0.2% and -3.4%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 3.1% in the last seven days.
JPM has an expected revenue and earnings growth rate of 2.6% and 5.1%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 1.5% in the last seven days.
Netflix reported second-quarter 2025 adjusted earnings of $7.19 per share, which beat the Zacks Consensus Estimate by 1.7%. The figure jumped 47.3% from the year-ago quarter. Revenues came in slightly above the company guidance at $11.07 billion, increasing 16% year over year, driven primarily by membership growth, higher subscription pricing and increased ad revenues. The figure missed the consensus mark by 0.06%.
The second-quarter content slate wrapped up on a high note as Squid Game S3 (122M views) became the company’s sixth biggest season of any series in just a few weeks of viewing. On April 1, NFLX launched its Ad Suite in the United States and ramped up this Ad Suite in international markets. The ad-supported offerings will enable management to witness impressive subscribers and ARPU (average revenue per user) growth.
NFLX raised its full-year 2025 revenue forecast to $44.8-$45.2 billion from the previous range of $43.5-$44.5 billion. The increase in revenues stems from multiple growth drivers working in tandem. Member growth accelerated toward the end of the second quarter, exceeding internal forecasts, while NFLX’s advertising business continues gaining traction with expectations to roughly double ad revenues in 2025.
Furthermore, Netflix uses AI, data science and machine language extensively to provide consumers with more appropriate and intuitive suggestions. Netflix's AI platform takes into account an individual’s viewing habits and hobbies and accordingly provides recommendations. AI applications enable NFLX to offer a high-quality streaming service at reduced bandwidths.
Netflix has an expected revenue and earnings growth rate of 15.3% and 31.4%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2.5% in the last seven days.
NFLX has an expected revenue and earnings growth rate of 12.8% and 23.4%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 3.3% in the last seven days.
The Progressive continues to gain on higher premiums, given its compelling product portfolio and strength in Personal auto, contributing about 75% of total premiums. Rate increases, personal auto application increases, improving retention rates and a strong independent agents' network should drive long-term premium growth and generate steady revenues.
Investment in digital transformation should support this strength. PGR has a reinsurance program to offset some of its losses and a strong financial position overall. PGR’s second-quarter 2025 earnings per share of $4.88 beat the Zacks Consensus Estimate by 10.1%. The bottom line increased 84.1% year over year.
PGR’s net premiums written were $20 billion in the quarter, up 12% from $17.9 billion a year ago. Net premiums earned grew 18% to $20.3 billion. The reported figure surpassed the Zacks Consensus Estimate of $20.1 billion.
PGR’s operating revenues increased 19.5% year over year to $42.2 billion, driven by 19% higher net premiums earned, a 29.3% increase in net investment income, an 18.9% rise in fees and 28% higher service revenues. The top line beat the Zacks Consensus Estimate by 96.4%.
The Progressive has an expected revenue and earnings growth rate of 16.6% and 23.4%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 3% in the last seven days.
PGR has an expected revenue and earnings growth rate of 9.9% and -4.9%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 1.2% in the last seven days.
GE Aerospace has been witnessing strength in its businesses, driven by robust demand for commercial engines, propulsion and additive technologies. GE’s second-quarter adjusted earnings were $1.66 per share, which beat the Zacks Consensus Estimate of $1.43. The bottom line surged 38% year over year.
Total revenues were $11 billion, indicating a year-over-year increase of 21%. Total orders grew 27% on a year-over-year basis to $14.2 billion. GE’s adjusted revenues were $10.2 billion, marking a year-over-year increase of 23%. The metric beat the consensus estimate of $9.7 billion.
Rising U.S. & international defense budgets, geopolitical tensions, positive airline & airframer dynamics and robust demand for commercial air travel augur well for the company. GE’s portfolio-reshaping actions are likely to unlock values for its shareholders.
For 2025, GE expects adjusted revenues to grow in the mid-teens range from the year-ago period's actual. Operating profit is estimated to be in the band of $8.2-$8.5 billion. Adjusted earnings are predicted to be in the range of $5.60-$5.80 per share. Free cash flow is anticipated in the band of $6.5-$6.9 billion, with the conversion rate projected at more than 100%.
GE Aerospace has an expected revenue and earnings growth rate of -4.1% and 22.6%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.6% in the last seven days.
GE has an expected revenue and earnings growth rate of 9.4% and 19.1%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 2.6% in the last seven days.
Interactive Brokers Group is a global automated electronic broker. IBKR came up with quarterly adjusted earnings of $0.51 per share, beating the Zacks Consensus Estimate of $0.46 per share. This compares to earnings of $0.44 per share a year ago. IBKR posted quarterly revenues of $1.48 billion, surpassing the Zacks Consensus Estimate by 8.76%. This compares to year-ago revenues of $1.23 billion.
IBKR’s efforts to develop proprietary software, lower compensation expenses relative to net revenues, enhance its emerging market customers and global footprint, along with relatively high rates, are expected to continue aiding revenues. IBKR’s initiatives to expand its product suite and the reach of its services will support financials.
Interactive Brokers Group has an expected revenue and earnings growth rate of 7.4% and 9.7%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 4.9% in the last seven days.
IBKR has an expected revenue and earnings growth rate of 6.6% and 6.7%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 4.6% in the last seven days.
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This article originally published on Zacks Investment Research (zacks.com).
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