Now streaming on Netflix: A show where profits Trump the trade war

The streaming giant reported first-quarter results late Thursday that could end up being the high point in a tumultuous earnings season. As companies across the board grapple with the deep levels of uncertainty raised by tariffs, trade wars and the possibility of a looming recession, Netflix solidly beat its revenue and earnings targets and even maintained the full-year projection it gave three months ago—in what seemed a different world.

The results sent Netflix’s stock higher in after-hours trading, a good showing since the shares already have been one of the few gainers in the past month’s market tumult. The company’s subscription-based video-streaming service isn’t exposed to the surprisingly high tariffs President Trump announced on April 2.

What’s truly impressive is the scale and reach of a service that has been on the market for 18 years and has now amassed an audience of more than 300 million paying subscribers. This also gives Netflix some resilience in an environment where consumers start tightening their belts.

That seems to be the case so far. “We’re paying close attention clearly to the consumer sentiment and where the broader economy is moving," Netflix co-CEO Greg Peters said on the earnings call. “But based on what we are seeing by actually operating the business right now, there’s nothing really significant to note."

Still, Netflix will bear close watching this year. Thursday’s report was the first time the company hasn’t disclosed any subscriber metrics, since it plans to focus on revenue and earnings going forward.

And by leaving its projection for its full-year operating margin at 29% Netflix is hinting at some earnings pressure in the second half. Its first-half margin is going to come in around 33%.

In a note to clients Thursday, Mark Mahaney of Evercore ISI said “it’s possible that Netflix is giving itself plenty of dry powder for an aggressive content spend ramp."

Pouring money into new shows is something Netflix has gotten quite good at over the years. It’s also what the company will need to scale up its burgeoning advertising business. This in turn provides a low-cost option for cash-strapped viewers.

Netflix isn’t recession proof. But in the current market, a dependable show free of drama is worth tuning into.

Write to Dan Gallagher at dan.gallagher@wsj.com.