The benchmark S&P 500 (SNPINDEX: ^GSPC) index had a spectacular year in 2023, logging a gain of 26.3% (including dividends), which is more than twice its historical average going back to 1957. The index is off to a hot start in 2024, too, with a gain of more than 6% so far.

A number of individual technology stocks have raced ahead this year. For example, Netflix (NFLX -0.34%) is up 25% year to date, and Spotify (SPOT 0.45%) has soared 35%. Both companies recently reported financial results for 2023 that were far better than expected, and there's reason to believe that momentum will continue.

Here's why it's not too late to buy these two unstoppable stocks.

1. Netflix

Netflix has long set the standard in the video streaming industry. It had 260.8 million subscribers at the end of 2023, which is more than any other platform.

And 13.1 million of those subscribers were added in the recent fourth quarter alone, a record number for the period. That gain also crushed Wall Street analysts' estimate of 9 million.

Netflix owes its recent success to a series of changes it made over the last couple of years to acquire more paying customers. First, it cracked down on password sharing to monetize some of the estimated 100 million global households that were borrowing Netflix from a friend or family member for free. Second, it introduced a cheaper subscription tier supplemented by advertising, to draw in new users who might want a lower price point.

And it continues to invest heavily in content. Earlier this year, the company announced a deal with TKO Group Holdings to acquire the global broadcast rights to World Wrestling Entertainment (WWE). It's worth an estimated $5 billion over 10 years, and it's a milestone in Netflix's pursuit of more live programming to keep viewers engaged.

The company plans to spend $17 billion to produce TV shows and movies in 2024, which is near a record high, while some top competitors like Disney have been slashing their budgets. As a result, there is no better time to make blockbuster deals to exert maximum pressure on the competition.

Thanks to its rapid subscriber growth, Netflix delivered a record $8.8 billion in revenue in the fourth quarter, a 12.5% year-over-year increase. That was the fastest growth in two years, and it was the second consecutive quarter of acceleration. The company's forecast for the first quarter of 2024 points to an even faster revenue increase of 13.2%.

Netflix is the only profitable pure-play streaming service in the industry. It delivered net income of $5.4 billion for the whole of 2023, and that secures its ability to continue outspending most of its peers.

Another record year might be in the cards for Netflix in 2024, but it's still in the early innings of its opportunity in areas like advertising, so the long term is even more exciting. So it's probably not too late to buy the stock.

2. Spotify

Like Netflix, Spotify is also at the top of its streaming field. It's the largest music streaming and podcasting platform in the world, and after expanding into audiobooks around 18 months ago, it's already ranked second behind Amazon's Audible in that segment.

Music isn't quite like TV shows and movies. Spotify and its competitors, like Apple Music, are basically content distributors for the major labels, not creators. Therefore, each platform offers a very similar content catalog, so they have to compete on other things like technology instead.

Spotify continues to develop artificial intelligence (AI) to enhance content recommendations for users. It also launched a feature called AI DJ last year, which curates music playlists and inserts live commentary using a software-generated voice.

Spotify also launched a feature called Clips in 2023, which allows artists to create short-form videos for their fans. Over 40,000 artists used Clips during the Spotify Wrapped campaign to close out 2023, and their videos were viewed 725 million times, with Gen Z responsible for half that number. Spotify effectively found a way to engage young users with a video feature similar to the one used on social media apps like TikTok and Meta Platforms' Instagram.

Spotify ended 2023 with a record 602 million monthly active users, a 23% increase compared to the end of 2022. It resulted in $14.2 billion in full-year revenue, which was a 13% increase, thanks mostly to its 236 million paying users on the Premium subscription (where most of its revenue comes from), which was 1 million above the company's forecast.

But 2023 was a year of efficiency for Spotify. It cut 1,500 jobs in December (17% of its workforce), which followed 800 cuts earlier in the year. Combined with careful cost controls in other areas, the company's operating costs only grew by 7.2% for the year. That allowed its operating loss to shrink by 32%, and it now forecasts an operating profit for the first quarter of 2024.

Spotify wants to reach 1 billion users by 2030, so there is still plenty of growth in the pipeline. And if that is accompanied by profitability along the way, its stock could prove to be a great long-term investment, especially at its historically cheap valuation right now.