It's been an up-and-down week for the stock market, but it looked as though investors were ready to celebrate on Friday. Index futures on the Nasdaq Composite (^IXIC -0.40%) were up nearly 1% in premarket trading Friday morning as the benchmark looked to reverse steep losses over the past couple of days.

For years, FAANG stocks captured investors' attention and spurred the big gains for the Nasdaq, as they represented the leaders of key industries spurring innovation and growth. Stocks like Netflix (NFLX 1.59%) and Alphabet (GOOG -0.22%) (GOOGL -0.16%) proved vulnerable to the conditions that led to the bear market in 2022, but investors now hope that the two companies are back moving in the right direction. Below, you'll see why shareholders are seeing shares of Netflix and Alphabet rise on Friday and whether it signals a broader rebound for the market as a whole.

Netflix gets an ad-supported boost

Shares of Netflix jumped 7% in premarket trading Friday. The streaming video pioneer released its latest quarterly results Thursday afternoon, and investors were generally pleased with what they saw as a new growth driver that could help boost the stock's long-term prospects.

The numbers from Netflix's fourth quarter actually weren't universally good. Revenue of $7.85 billion was up 2% year over year but down sequentially for the second quarter in a row. Net income plunged to just $55 million, producing earnings of just $0.12 per share.

However, most investors focused on accelerating growth in subscription counts. Netflix added 7.66 million new paid streaming memberships, climbing to 230.75 million and rising 4% from year-ago levels. The company said it has been pleased with the early results of its ad-supported service tier following its launch in November 2022. Moreover, free cash flow stayed solid at $332 million, showing that the streaming company still has the financial resources to invest in new content and other revenue-enhancing initiatives.

Netflix also anticipates better times ahead. It projected that year-over-year sales growth would turn back upward in the first quarter of 2023, helping to send net income back toward levels consistent with past quarters. Moreover, the video specialist expects free cash flow of at least $3 billion.

Shareholders also seemed comfortable with Netflix's succession moves, as Reed Hastings steps out of the co-CEO role to focus on his executive board chair role overseeing Ted Sarandos and Greg Peters. After a tough period early in 2022, Netflix stock has performed quite well over the past six months, and shareholders are happy to ride the positive momentum higher.

Alphabet joins the layoff trend

Shares of Alphabet were up 3% in premarket trading. The Google parent became the latest tech giant to announce job cuts, adding to concerns about a white-collar recession but pleasing shareholders with its efforts to rein in costs.

In a filing with the U.S. Securities and Exchange Commission, Alphabet revealed a message that CEO Sundar Pichai sent to Google employees. The message said that the company is reducing its workforce by 12,000 roles, with employees both in the U.S. and internationally seeing the impact of the cuts.

From an investing perspective, Pichai emphasized his confidence in the investments that Alphabet has made in artificial intelligence (AI). Indeed, capturing the full potential of AI was a primary justification for the job cuts, as Alphabet undergoes a thorough review of all of its product areas and functions to determine which are aligned most closely with its highest business priorities.

Alphabet's severance package will include full pay during the required notification period, 16 weeks of salary plus two weeks for each year of service, acceleration of equity-based compensation pay, payouts of bonuses and vacation time, and assistance with job placement and health insurance coverage. That's more than many laid-off employees get elsewhere, but it still shows the extent to which the tech industry more broadly has had to reverse aggressive past hiring practices in light of deteriorating economic conditions. Many hope this will be the end of such measures, but it seems as though more companies announce similar measures on a nearly daily basis.