Without a doubt, Netflix (NASDAQ: NFLX) is one of the best-performing stocks of this century. Shares have skyrocketed a ridiculous 19,320% in the past 20 years. To provide context, the S&P 500 produced a total return of 646% during this same time period.

This top streaming stock has clearly been a massive winner in the past, which has made it one of the world's most valuable companies, with a market cap of $275 billion. But can Netflix become a trillion-dollar enterprise by 2030?

Changing the entertainment industry

It's important to first zoom out and understand how Netflix got to this point. The company's early management team realized that the internet would revolutionize how consumers watched video entertainment. And this thesis was proven correct.

Executives positioned Netflix to take advantage of the streaming secular trend. The business first launched its service in the U.S. in 2007. This was at a time when traditional cable TV was still the most popular way households got their video entertainment.

But Netflix was able to rapidly grow its subscriber base and revenue by expanding its content offerings and entering new markets. What's more, the business was winning over consumers by simply providing a much better user experience. Gone were the days of being restricted by what one could watch, at what time they could watch it, and how much of it they could watch.

A global media powerhouse

Today, Netflix is a global media juggernaut. After adding 17.4 million net new customers in the first six months of this year, the company now has a whopping 277.7 million subscribers scattered across 190 countries. And in the last 12 months, Netflix raked in $36.3 billion in revenue.

That scale is key to the company's success. Netflix has such a large user and revenue base that it is able to spend massive amounts on content, roughly $17 billion this year. It's not only difficult for rivals to spend this much, but to do so profitably is a different challenge altogether. Netflix's first-mover advantage is hard to overstate.

This is an extremely profitable enterprise. Netflix reported an operating margin of 21% last year, with executives forecasting a 26% margin in 2024. That is a huge improvement from the 13% operating margin in 2019, which clearly indicates a scalable business model.

Additionally, the company is generating lots of free cash flow, to the tune of $6.9 billion in 2023 and an expected $6 billion this year. The skeptics never thought this day would come. Netflix even engages in share buybacks these days.