The U.S. streaming giant faces fresh regulatory scrutiny in South Africa as authorities examine the cost of digital media and communications services for consumers.
South Africa’s telecommunications regulator plans to investigate prices charged by so-called over-the-top service providers, including Netflix and Meta Platforms Inc.’s (NASDAQ:META) WhatsApp, Bloomberg reported on Monday, citing Business Day.
South Africa Reviews Digital Service CostsThe Independent Communications Authority of South Africa plans to assess what consumers pay for digital services as part of the inquiry, according to the report.
The regulator will separately investigate telecommunications-service costs, potentially affecting major operators including MTN Group Ltd., Vodacom Group Ltd., Telkom SA SOC Ltd. and Cell C Holdings Ltd.
South Africa’s telecommunications-service costs rank among the highest globally, according to the report.
Regulator Builds on Earlier Pricing ReviewsThe inquiry follows previous regulatory reviews of data-service costs and monitoring of prices after authorities allocated high-speed internet spectrum and introduced measures aimed at increasing competition.
The latest move also follows an effort by South Africa’s communications minister to bring in experts to identify policies and other interventions that could lower consumer prices.
The planned review places Netflix and other digital-service providers under closer scrutiny as regulators examine the affordability of services delivered over telecommunications networks.
The regulator had not provided additional comment when Bloomberg sought a response outside normal business hours.
Analyst Consensus & Recent Actions: The stock carries a Buy rating with an average price forecast of $90.67. Recent analyst moves include:
Wolfe Research: Outperform (Raises target to $95 on Aug. 25) Baird: Outperform (Lowers target to $90 on July 22) Morgan Stanley: Overweight (Lowers target to $83 on July 17) Top ETF Exposure REX FANG & Innovation Equity Premium Income ETF (NASDAQ:FEPI): 6.86% Weight Global X PureCap MSCI Communication Services ETF (NYSE:GXPC): 4.55% Weight Pathfinder Focused Opportunities ETF (NASDAQ:PFOE): 4.72% Weight Significance: Because Netflix carries such a heavy weight in these funds, any significant inflows or outflows for these ETFs will likely force automatic buying or selling of the stock.
NFLX Price ActionNetflix shares were down 2.28% at $76.47 at the time of publication on Tuesday, according to Benzinga Pro data.
Photo: Shutterstock
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Netflix uvedl, že jeho reklamně podporovaný plán nyní oslovuje více než 250 milionů měsíčně aktivních diváků. Firma čeká, že tržby z reklamy letos zhruba zdvojnásobí na asi 3 miliardy USD.
Streaming giant Netflix (NFLX -1.89%) told advertisers in May that its ad-supported plan now reaches more than 250 million monthly active viewers, up from 190 million last November.
And the money is following the audience. Management expects advertising revenue to roughly double this year, to about $3 billion. It's a small piece of the company's forecast of about $51 billion in total revenue for 2026 -- but easily the fastest-growing piece.
I don't think the doubling stops this year, either. I predict Netflix's advertising revenue passes $6 billion in 2027.
The case rests on three things the company already discloses: a growing viewer base, more countries to sell ads in, and ad revenue per viewer with plenty of room to rise.
Image source: Netflix.
The audience is still growing quicklyA monthly active viewer, in Netflix's definition, is a member who watched at least one minute of ads in a month, multiplied by the estimated number of people in that household. The household estimate comes from Netflix's own research, not a third-party firm.
The definition matters because it changed. In May 2025, Netflix counted 94 million monthly active users (profiles, not people), and Amy Reinhard, the company's president of advertising, said at the time that the figure translated to about 170 million viewers.
In other words, the audience didn't nearly triple over the past year, as the headline numbers suggest. Measured viewers against viewers -- a close but not perfect comparison -- it grew by about half. And that's still impressive growth for an audience this large.
The ad plan is also where new members go. Notably, Netflix said more than 60% of sign-ups choose it in the countries where it's available, and more than 80% of ad-plan members watch every week.
More countries are on the way, too. Starting next year, the plan is set to launch in 15 more, including Sweden, Poland, Indonesia, and the Philippines -- on top of the dozen markets where it sells ads today.
Can the revenue double again?In 2025, only the company's third year selling advertising, ad revenue grew to over $1.5 billion (more than 2.5 times its 2024 level). And this year's forecast calls for a rough doubling on top of that.
About $3 billion spread across more than 250 million viewers works out to about $12 per viewer a year, or about a dollar a month. Meanwhile, members pay $8.99 a month just for the U.S. ad plan's subscription, following a price increase in March. (That price is per account, while the ad figure counts every viewer in a household.) In other words, the advertising half of this business still brings in very little per viewer. Even doubling ad revenue on today's audience would only take that figure to about $2 a month.
Advertisers appear willing to pay up. Netflix said in August that commitments from its U.S. upfront (the annual negotiation in which advertisers lock in spending early) nearly doubled this year. Reinhard told advertisers in May that 44% of the members who see an ad on Netflix never see that ad on broadcast TV or other streaming services.
Sure, new ad markets typically start slowly, and a weak economy could cut advertising budgets faster than subscriptions. But if the audience keeps climbing and Netflix earns a bit more ad revenue per viewer, $6 billion is within reach.
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Even $6 billion wouldn't fix everythingAdvertising matters this much because growth elsewhere is cooling. Netflix's second-quarter revenue grew 13% year over year, down from a 17.6% pace in the fourth quarter of 2025, and management forecasts 11.7% for the third quarter. Each quarter has been slower than the last.
Another doubling would mean about $3 billion of new revenue in 2027, or about 6 percentage points of growth on this year's forecast base. For the growth stock, that could be the difference between total growth sliding toward single digits and holding in the low teens.
What advertising can't do is carry the company. Advertising ultimately sells attention, and attention is barely growing. Netflix members watched more than 97 billion hours of content from January through June, up just 2% from the same period of 2025.
Even at $6 billion, advertising would be barely more than a tenth of the streaming service's revenue. Memberships and pricing still set Netflix's growth rate.
So, does Netflix's advertising revenue pass $6 billion in 2027? I believe it does. The audience keeps growing, and the ad revenue per viewer is still tiny.
As for Netflix stock, it trades near $77 as of this writing, or about 20 times expected 2027 earnings. That's arguably a reasonable price. But with growth cooling outside the ad line, I'll watch from the sidelines for now.
There's no denying Netflix's (NFLX -5.35%) highest growth days are (probably) in the past rather than in the future. Not only did its second-quarter year-over-year revenue growth of 13.4% -- the weakest growth rate of the past four quarters -- to $12.56 billion miss analysts' already-lowered expectations of just under $12.59 billion, but revenue guidance for the quarter currently underway was also disappointing, at only 11.7% better than 2025's Q3 comparison.
Sensing this headwind could mark the beginning of a more sweeping slowdown for the entire streaming business, Netflix stock has performed poorly since April, and really, since reaching a record high in the middle of last year. That's when the whole industry's transition from its growth phase to its slower, fully mature phase began to become clearer.
Nevertheless, long-term growth investors might want to own a stake in the streaming giant anyway, despite its complete lack of dividends. Here's why.
Image source: Getty Images.
Being first, and now biggest, makes all the difference While Netflix's future numbers will almost certainly look weaker, the stock is still a solid buy for a pair of related reasons. Those are, (1) the streaming business is here to stay, and (2) Netflix is positioned to continue dominating it.
That doesn't mean competitors aren't trying to dethrone the market leader. In fact, numbers from TV-ratings agency Nielsen indicate that over the course of the past year, U.S. consumers are -- albeit only slightly -- decreasingly tuning into Netflix. Netflix is still the leading streaming name within the United States though, and according to data from Hub Research, the first streaming platform U.S. consumers visit when they turn their television on.
It isn't doing too shabbily outside of the U.S. either. Its European and Middle East arm's revenue improved 11% on a currency-neutral basis last quarter, and grew 16% in Latin America. Even its relatively small Asia/Pacific operation experienced a neutral sales growth 18% during the second quarter of 2026. That's encouraging, particularly given that Netflix currently serves fewer than half of the planet's broadband customers, and its programming only accounts for a tiny fraction of the world's total television viewing time.
In other words, there's room to continue growing even if its domestic presence may be peaking, according to Pew Research, a market-leading 72% penetration rate of U.S. households
Perhaps more importantly, there's good reason to believe Netflix can and will continue growing here and abroad, particularly now that it offers an ad-supported option.
The foundation for this continued growth is two-fold.
The first of these folds is the fact that being the first name of its kind in the streaming business (it arguably created the streaming business, in fact) as well as the most entrenched, Netflix is the yardstick by which consumers measure all other streaming services. Indeed, the brand name itself is almost synonymous with the word "streaming" itself. That's powerful. It means Netflix is the name consumers consider first. It also means Netflix has its pick of potential partners, if and when it chooses to forge such relationships.
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The other piece of the argument that Netflix is positioned to continue delivering value-building growth is its sheer size and scale, and everything that comes with it. And chief among these upsides is wider profit margins.
Although most major streaming platforms are now profitable on an operating or EBITDA basis, it's still unclear whether they are producing actual net profits. Netflix most definitely is, though. Despite this year's slowdown, through the first half of 2026, roughly $6.0 billion (24%) of its $24.8 billion in year-to-date revenue was turned into ordinary net income, easily making this company the most profitable name in the streaming business. As such, it can spend as much as it needs to in order to remain ahead of its competitors. In light of this, the streaming industry's broad slowdown actually works to Netflix's advantage, making it more difficult for rivals to achieve the subscriber growth needed to better compete with the industry's titan.
Netflix's larger top- and bottom-line results are also a testament to the quality and depth of its content library, much of which is self-produced.
Durable dominance Will there ever come a time when Netflix just runs out of growth runway? Sure. Nothing lasts forever.
That point is many, many years down the road for Netflix, though, and there's plenty of opportunity for growth between now and then. An outlook from Mordor Intelligence suggests the worldwide streaming market is set to grow at an average annual rate of nearly 11% through 2031, matched by global growth of the ad-supported streaming business that Netflix is now in.
Netflix could continue growing nicely for far longer than that, though, simply because it's got a powerful brand name that can be leveraged in a number of ways beyond the conventional delivery of on-demand entertainment content. This includes a deeper dive into theatrical films, the licensing and monetization of home-grown intellectual property, video gaming, and more. Indeed, it's not inconceivable that Netflix could eventually even develop its own cable channel, utilizing the very cable television business it's largely forced into a massive reset.
Bottom line? Unlike its competitors, Netflix isn't just another struggling streamer that looks more like a late-to-the-party afterthought than a strategically intentional concept. It's a reliably viable business with a powerful brand name that can be leveraged in a bunch of different ways. That's the long-term growth potential you'd be buying into ... even if it doesn't pay dividends in the meantime.
Netflix je podle BMO Capital Markets stále na nákup s cílovou cenou 135 USD, což znamená zhruba 73% potenciál růstu. Konsenzus analytiků je 93,66 USD, asi 20 % nad aktuální cenou 78,25 USD.
Netflix has shed more than a third of its value while the broader market climbs, yet one Wall Street analyst sees a path back that would leave today's sellers deeply regretting their exits.
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Netflix currently trades at $78.25 while the average Wall Street price target sits at $93.66. That leaves a gap of roughly 20% between the current quote and consensus.
Netflix (NASDAQ:NFLX | NFLX Price Prediction) is the world’s largest subscription streaming service, guiding 2026 revenue to $51.0B to $51.4B with an ad-supported tier on track to roughly double. Wall Street has watched the name closely as it flipped from streaming’s untouchable growth story to a battleground stock in the span of nine months. Consensus isn’t even the aggressive read here: BMO Capital Markets carries a Street-high target of $135 on the shares.
What Went Wrong Between January and Summer Netflix has shed over a third of its value in a year, down 37.77% over 12 months and 16.54% year to date. The unraveling accelerated when Netflix announced an all-cash acquisition of Warner Bros. at $27.75 per share in late 2025, pausing buybacks and hitching the story to a $42.2B bridge facility. Q3 2025 earnings then missed on a $619 million Brazilian tax charge that compressed operating margin to 28.2%.
The saga got messier. Netflix terminated the original WBD agreement in Q1 2026 and paid a $2.80B breakup fee, which hit free cash flow through higher cash taxes. Free cash flow fell to $1.53B in Q2 from $2.27B a year earlier. The S&P 500, meanwhile, is up 12.94% year to date. Netflix moved sharply in the opposite direction.
Why the Sell-Side Is Still on Board BMO Capital Markets’ Brian Pitz carries the Street-high $135 target, which implies roughly 73% upside from current levels. His Outperform thesis rests on three pillars: an ad-tier monetization super-cycle, a content moat that protects churn and pricing power, and structural margin expansion as advertising and password-sharing revenue flow directly to operating income.
Management has given analysts real numbers to underwrite. Netflix reiterated 13% to 14% full-year revenue growth, roughly $6 billion of incremental revenue, and about $12.5B of free cash flow for 2026. Ad revenue is tracking to ~$3B this year. Q2 buybacks of $4.7B were the largest quarterly repurchase in company history, with $27.1B still authorized.
CFO Spence Neumann framed the runway plainly on the Q2 call: “We’re entertaining an audience approaching a billion people, with still lots of room to grow into our addressable market on every measure.”
Coverage skews bullish. Of the analysts polled, 7 rate the stock Strong Buy, 29 Buy, and 15 Hold, with no active Sells. Recent 30-day revisions have leaned negative as models digest WBD-related noise, but no house has capitulated on the story.
Where Netflix Stands Against Streaming Peers Netflix fell largely alone. The rest of the streaming complex is a mixed bag.
Walt Disney (NYSE:DIS) trades at $105.31 against an average target of $128.18, implying roughly 22% upside. Shares are down 6.71% year to date, cushioned by the Experiences segment. Ratings skew positive with 6 Strong Buy and 24 Buy against 2 Hold and 1 Sell. Real upside, but a fraction of what BMO sees at Netflix.
Warner Bros. Discovery (NASDAQ:WBD) trades at $28.25 with an average target of $29.82, or roughly 6% implied upside. WBD is now the subject of a Paramount Skydance merger after Netflix walked, and analyst posture is cautious with 2 Buy, 16 Hold, and 1 Strong Sell. The pending deal caps the story.
Roku (NASDAQ:ROKU) trades at $155.59 versus a $162.33 target, roughly 4% implied upside. Roku is up 43.41% YTD, showing exactly the momentum Netflix lost. Coverage sits at 1 Strong Buy, 9 Buy, 15 Hold, and 1 Strong Sell.
The largest analyst-implied upside in this group sits with Netflix, whether measured against the $93.66 average or BMO’s $135. Peers have re-rated with the market. Netflix has lagged behind that reset.
What the Numbers Actually Say Netflix trades at $78.25 with an average 12-month target of $93.66 across covering analysts, implying roughly 20% upside, while BMO’s $135 Street-high implies roughly 73%. The stock is down 16.54% year to date and 37.77% over 12 months, against a 12.94% YTD gain and 18.65% one-year return for the S&P 500. Analyst targets are one data point among many.
Forward EPS consensus sits at $3.5844 for 2026 and $3.8184 for 2027, on revenue of $51.22B and $57.01B. Trailing P/E is 25 and forward P/E is 22. Multiples have compressed while the growth trajectory has held.
Where I Land on Netflix Right Now Netflix looks compelling here if management delivers on the 2026 plan (guided revenue, $12.5B of free cash flow, ~$3B in ad revenue) and if the WBD situation either resolves at reasonable terms or gets abandoned again without further balance sheet damage. The path back to consensus is unglamorous: execute, scale ads, and let the $27.1B remaining buyback authorization keep shrinking the share count.
The bear case rests on the WBD chapter being a strategic mistake priced with real integration and financing risk, or if competitive pressure from Disney, YouTube, and Amazon compresses margins from the current 33.4% operating rate. A $1B debt maturity later in 2026 and ongoing tax disputes add overhang.
My lean: this looks more like a rare value setup for a name that seldom offers one, provided the WBD situation resolves without another surprise. The BMO $135 case requires the entire bull thesis to fire, but even the consensus $93.66 offers a defensible re-rating path from here.
Contact [email protected] for any questions or corrections.
Netflix (NFLX -5.35%) raised prices on every one of its U.K. plans in the past few days. The ad-supported standard plan took the biggest jump, moving from £5.99 to £7.99 a month (a third more), while the ad-free standard plan went to £13.99 and premium to £20.99. New members pay the new prices right away, and existing members typically get 30 days' notice before the change reaches their bills.
Shares of the streaming giant fell 5.4% on Friday to $78.25, the same day the increase made headlines.
Price increases are nothing new for this company, though. Netflix has been raising prices for 15 years, in markets all over the world, and its annual revenue has grown every single year through all of them.
But that streak is a low bar. The better measure, I'd argue, is what each increase did to the company's revenue growth rate -- and that record is more interesting than the streak itself.
Image source: Netflix.
The increases are coming fasterNetflix last raised U.K. prices in February 2025, when the ad-supported plan went from £4.99 to £5.99 a month. That makes this the second U.K. increase in about 19 months, and it leaves the ad tier costing 60% more than it did at the start of last year.
Netflix raised U.S. prices in March too, its second increase there in about 14 months, taking the standard plan from $17.99 to $19.99 a month.
Notably, the ad-supported tier (the plan built to catch price-sensitive members) is climbing fastest in both markets.
Revenue has grown through every increaseThe worst increase Netflix ever made came in July 2011, when the company split its $9.99 streaming-plus-DVD plan into two $7.99 plans. Management acknowledged in its second-quarter 2011 shareholder letter that the change could be "as much as a 60% increase" for members who wanted to keep both services.
Hundreds of thousands of members canceled. Netflix ended the third quarter of 2011 with about 23.8 million U.S. subscribers, down about 805,000 in three months. And still, revenue rose 48% that year, and it grew another 13% in 2012.
The closest the streak has come to breaking was 2022. Netflix had raised U.S. prices that January, taking the standard plan from $13.99 to $15.49, and revenue for the year grew just 6.5% -- the company's slowest year of growth in at least a decade. A subscriber slump and a strong dollar contributed too. Even then, the top line grew. Growth stayed slow in 2023, then reaccelerated: revenue rose about 16% in both 2024 and 2025, reaching $45.2 billion last year, and 2025 opened with another round of U.S. price increases.
In short, no Netflix price increase has ever been followed by a down year of revenue. Where an increase can show up is in the growth rate, and even the clearest case took more than pricing to get there.
What's different this time is where the increase lands. Netflix's advertising business is its fastest-growing revenue line (ad revenue topped $1.5 billion in 2025, up more than 150%, and management is aiming to roughly double it this year), and that business depends on the ad-supported plan attracting members. Raising the plan's price by a third may test how much that audience is willing to pay.
The early evidence from the U.S. increase looks fine. In the shareholder letter accompanying its second-quarter results, Netflix said U.S. and Canada revenue grew 10% year over year, with what it described as only a partial quarter of impact from the March increase. The change, in management's words, "has gone well and as expected."
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The companywide trend deserves more caution. Second-quarter revenue growth was 13% year over year, and the forecast for the third quarter is 11.7% -- a decelerating path. Full-year revenue guidance sits at $51.0 billion to $51.4 billion, or 13% to 14% growth, down from nearly 16% in 2025.
Meanwhile, engagement is nearly flat, with members watching only 2% more hours in this year's first half than in last year's. In other words, more members, higher prices, and advertising are carrying the growth, not more hours watched.
Ultimately, I expect the streak to survive this increase too. That kind of pricing power, I think, is rare, and Netflix has proved it over and over.
But the stock's valuation arguably already gives the company credit for it. At about $78, the price-to-earnings ratio is about 20 measured against expected 2027 earnings, a level that arguably assumes the pricing power continues.
Key Takeaways Netflix shares have rebounded as investors focus on the scaling of its advertising business.Netflix expanded AI ad tools and programmatic access while seeing strong interest in live-event inventory.Ad revenues are expected to roughly double to $3 billion in 2026, with clients up 70% year over year. Netflix (NFLX - Free Report) shares have climbed sharply off their 2026 lows in recent weeks, and the advertising business is emerging as the central thread in that recovery narrative. As the stock works to claw back ground lost earlier this year, investor attention has increasingly shifted toward how quickly the company's ad-supported tier can scale and what that means for the broader growth story.
The renewed focus follows a set of developments the company has flagged around its advertising operations. In its most recent shareholder communication, Netflix said it expanded AI-powered tools across the advertising lifecycle — spanning planning, creative production, campaign management and reporting — and extended programmatic access to Pause Ads and live inventory, a move aimed at opening the platform to a broader range of buyers, including smaller advertisers previously limited by manual processes. The company also noted that its U.S. upfront negotiations were in advanced stages, with commitments expected to close in the following weeks, and pointed to strong advertiser interest in its live-event lineup.
These initiatives sit against a backdrop of steady financial performance. For the second quarter of 2026, Netflix reported revenues of $12.56 billion, up 13% year over year, with operating margin at 33.4% and earnings per share of 80 cents. The company repurchased $4.7 billion of stock during the quarter, its largest buyback quarter on record, leaving $27.1 billion in remaining authorization. On advertising specifically, Netflix has guided toward roughly doubling ad revenues to approximately $3 billion in 2026, with an advertiser base that had grown to more than 4,000 clients, up 70% year over year, as of its most recent count.
Looking ahead, the company reiterated its full-year revenue outlook of $51 billion to $51.4 billion, implying 13-14% growth, alongside a 31.5% operating margin target and roughly $12.5 billion in free cash flow, with growth in memberships, pricing and advertising cited as the primary drivers for the remainder of the year.
With the ad business still a fraction of total revenues but expanding at a rapid clip, its trajectory over the next two quarters is likely to remain a key determinant of whether Netflix's stock recovery has staying power.
Competitors Show Divergent Ad Growth PathsAmong U.S. rivals pursuing similar ad-supported growth, Disney (DIS - Free Report) and Comcast (CMCSA - Free Report) offer contrasting benchmarks. Disney's direct-to-consumer advertising revenues rose 3% in its fiscal third quarter, with Disney's Entertainment segment ad sales actually dipping 1% even as Disney's ESPN business offset the softness. Comcast, by contrast, posted a sharper trajectory: Peacock's advertising revenues jumped nearly 70% in the second quarter, aided by World Cup and NBA coverage, helping Comcast's streaming arm turn profitable for the first time. Comcast's faster ad ramp contrasts with Disney's steadier, subscription-led model, underscoring how differently each rival is monetizing its streaming audience.
NFLX’s Price Performance, Valuation & EstimatesShares of Netflix have plunged 11.8% year to date, underperforming the Zacks Broadcast Radio and Television industry and the Zacks Consumer Discretionary sector’s decline of 10.8% and 9.3%, respectively.
NFLX’s YTD Share Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, Netflix appears overvalued, trading at a forward 12-month price-to-sales ratio of 6.24X, higher than the industry’s 3.17X. NFLX carries a Value Score of D.
NFLX’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NFLX’s 2026 earnings is pegged at $3.59 per share, unchanged over the past 30 days. This indicates a 41.9% increase from the previous year.
NFLX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Jim Cramer označil Netflix za „buy“, ale ne za velký nákup. Firma zároveň oznámila tržby 12,56 miliardy USD a rekordní zpětný odkup akcií za 4,7 miliardy USD.
A longtime Netflix shareholder put Jim Cramer on the spot after watching shares lose more than a third of their value, and his answer about whether to hold, add, or sell reveals just how conflicted even the bulls have become.
A longtime Netflix shareholder called into Mad Money last week wondering if Netflix (NASDAQ:NFLX | NFLX Price Prediction) is still the same company he originally bought: “I’ve been a believer in the importance of corporate leadership just like you, and I’ve been very patient,” he said.
However, he added his reasons for concern: “Since February, and what I think was a very poorly managed Paramount offer, and now with Reed Hastings no longer at the helm, I’m starting to wonder if this is really the same company I invested in.“
The caller closed by saying: “Is it time to hold, add, or sell Netflix? What do we do?”
Jim Cramer Cautiously Believes in Netflix Cramer responed that he’s cautiously bullish on Netflix: “I think that Netflix is a buy, not a huge buy. I mean, I wouldn’t put a lot of money, but I think you can bounce here,” he said.
He then validated the caller’s discomfort with recent sector dealmaking: “In the time, the whole Warner Bros. Discovery delivery, it left me cold, too.” Yet he still has faith in the operators: “I do think these are still the great guys that have built a terrific company.”
Netflix’s Record $4.7 Billion Buyback Meets Slower Cash Flow Netflix’s Q2 FY2026 earnings report gives investors something to weigh. Revenue of $12.56 billion grew 13.4% year over year, EPS came in at $0.80 against a $0.79 estimate, and operating margin reached 33.4%. Free cash flow, however, fell to $1.53 billion from $2.27 billion a year ago. Netflix repurchased $4.7 billion of stock, its largest quarterly buyback ever, with roughly $27 billion of authorization remaining. Full-year guidance calls for $51.00-$51.40 billion in revenue, a 31.5% operating margin, and roughly $3.00 billion of ad revenue.
The stock reflects the skepticism. Shares closed at $79.84 on August 27, down 34.74% over the past year and 14.85% year to date, though up 10.29% over the past month. Netflix trades at a 26 trailing P/E with 29 Buy and 7 Strong Buy ratings versus 15 Holds.
Key Takeaways Cramer’s Netflix call is cautiously bullish: he sees potential for a bounce but would limit his position size. Revenue growth and substantial buybacks support the business case, while lower free cash flow and concerns about leadership and dealmaking temper confidence. His answer to an uncertain shareholder is to keep a small position.
Contact [email protected] for any questions or corrections.
Netflix posílil herní strategii exkluzivním prvním pohledem na Grand Theft Auto VI 27. srpna a měl šestihodinový náskok na 27 minut nových záběrů. Tvrdí také, že jeho herní tituly zvyšují zapojení uživatelů. Přímý příspěvek her k tržbám ale zatím nezveřejňuje.
Key Takeaways Netflix's GTA VI partnership strengthens its strategy of aligning with major gaming moments.Netflix saw strong game debuts, while Playground daily players tripled and kids' engagement rose 600%.Games remain an engagement driver, with direct revenue contribution still unquantified. Netflix's (NFLX - Free Report) push into gaming took its highest-profile turn yet on Aug. 27, when the company aired an exclusive extended first look at Grand Theft Auto VI, giving subscribers a six-hour head start on 27 minutes of new footage before Rockstar Games released it on YouTube and its own channels. The tie-up, described by Netflix as a first-of-its-kind partnership, arrives ahead of GTA VI's Nov. 19 launch on PlayStation 5 and Xbox Series X/S and follows Netflix's earlier addition of GTA: The Trilogy to its mobile game library. The collaboration extends Netflix's strategy of aligning itself with major gaming cultural moments rather than only producing its own titles.
That strategy has shown early traction elsewhere in the games unit. In its second-quarter 2026 shareholder letter, Netflix said its cloud-based TV games notched their two most successful debuts to date in June with FIFA World Cup: Launch Edition and Unhinged. Netflix Playground, the standalone app for kids' games, launched in April, has seen daily players triple since launch, and kids' mobile game engagement is up 600% year over year, though from a small base. Netflix has organized its games effort around four categories — narrative, party and puzzle, mainstream, and kids — and continues to frame the segment as an engagement driver rather than a standalone revenue source.
On the financial side, Netflix reported second-quarter revenues of $12.6 billion, up 13% year over year, with an operating margin of 33.4%. The company narrowed its full-year 2026 revenue forecast to $51.0-$51.4 billion and reiterated a 31.5% operating margin target, with growth attributed primarily to membership gains, pricing and advertising rather than games. View hours grew 2% in the first half of 2026, and Netflix noted gameplay hours are not included in that figure. Games remain unbroken out in Netflix's financial disclosures, leaving their direct revenue contribution unquantified for now.
Gaming Peers: Take-Two Interactive and RobloxUnlike Netflix, Take-Two Interactive (TTWO - Free Report) and Roblox (RBLX - Free Report) already generate the bulk of their revenue directly from gaming. Take-Two, the publisher behind GTA VI through its Rockstar Games label, reported net bookings of roughly $1.5 billion in its most recent quarter, with GTA VI positioned as its primary growth catalyst. Roblox, meanwhile, continues to scale bookings and daily active users through its user-generated content platform and virtual economy. Both Take-Two and Roblox operate gaming as a core, monetized business line, a structural contrast to Netflix, where games remain an engagement-linked feature rather than a disclosed revenue segment.
NFLX’s Price Performance, Valuation & EstimatesShares of Netflix have plunged 12.8% year to date, underperforming the Zacks Broadcast Radio and Television industry and the Zacks Consumer Discretionary sector’s decline of 9.4% and 6.7%, respectively.
NFLX’s YTD Share Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, Netflix appears overvalued, trading at a forward 12-month price-to-sales ratio of 6.17X, higher than the industry’s 3.17X. NFLX carries a Value Score of D.
NFLX’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NFLX’s 2026 earnings is pegged at $3.59 per share, unchanged over the past 30 days. This indicates a 41.9% increase from the previous year.
NFLX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Netflix ve 2. čtvrtletí zvýšil tržby o 13,37 % na 12,56 miliardy USD a EPS ve výši 0,80 překonal odhady. Akcie jsou za posledních 12 měsíců níže o 33,64 %.
Netflix stock is down more than 30% over the past year while the business keeps growing revenue at double digits, and that disconnect is exactly what has one major billionaire investor stepping back in.
Netflix (NASDAQ:NFLX | NFLX Price Prediction) has been a punching bag for the past year, but our model sees a very different setup heading into 2027. With the stock trading at $81.72, down 33.64% over the last twelve months, sentiment has rarely been this washed out on a company still growing revenue in the double digits.
Our 24/7 Wall St. price target for Netflix is $181.89, implying 122.58% upside over the next twelve months. Our recommendation is buy, with confidence classified as high.
24/7 Wall St. Price Target Summary Metric Value Current Price $81.72 24/7 Wall St. Price Target $181.89 Upside 122.58% Recommendation BUY Confidence Level 90% Why Netflix Sold Off and What Just Changed Netflix stock is down 12.84% year to date and sits about 26% below its 52-week high of $126.71. Shares are up 10.99% over the last month and 2.68% in the past week.
Q2 2026 delivered revenue of $12.56 billion, up 13.37% year over year, with EPS of $0.80 beating consensus. Double-digit growth showed up across every region, led by Latin America at 21%.
Seeking Alpha noted Bill Ackman’s return to Netflix, and a widely upvoted WallStreetBets thread titled “Why the fuck is Netflix down 40% over the past year?” captured retail frustration that often marks capitulation lows.
Why Bulls See a Breakout Ahead The bull thesis rests on three pillars: advertising, pricing, and runway. Netflix is guiding 2026 revenue to $51 billion to $51.4 billion with ad revenue roughly doubling to $3 billion, and free cash flow near $12.5 billion. Advertiser count already grew 70% year over year to over 4,000 clients.
Management flagged the company is only under 45% penetrated into 800 million addressable households globally and captures roughly 5% of global TV view share.
Buybacks are massive: $4.7 billion repurchased in Q2 2026, the largest quarter in company history, with $27.1 billion remaining. If ad monetization scales as guided, the bull case points to $195.83.
Risks Worth Watching The bear case leans on decelerating FX-neutral growth (from 12% in Q2 to 11% guided in Q3), content amortization growing roughly 10%, a $1 billion debt maturity in 2026, and viewership competition from the Winter Olympics and World Cup.
Q2 free cash flow declined 32.73% year over year, but bulls counter this reflects higher cash taxes tied to the Warner Bros. termination fee received in Q1, with core operations still intact. Insider activity trending net selling is worth noting. Our bear case lands at $144.89, still well above the current quote.
How Netflix Compares to Disney and Spotify Disney (NYSE:DIS) trades at a trailing P/E of 15 with an operating margin of 14.6%, versus Netflix at 26 and a Q2 operating margin of 33.4%. Disney is cheaper on paper, but Netflix earns its premium with more than double the operating margin.
Spotify (NYSE:SPOT) trades at a trailing P/E near 51, with Q2 revenue growth of 13.9%. That is nearly identical growth to Netflix, but at almost twice the earnings multiple. Against this pair, our 24/7 Wall St. price target looks reasonable, closer to conservative.
Company Trailing P/E Operating Margin Netflix 26 33.4% Disney 15 14.6% Spotify 51 12.8% Bottom Line on Netflix’s Setup The 24/7 Wall St. price target of $181.89 reflects a stock priced for stagnation and a business still executing. Our model’s recommendation is buy, with high confidence.
The bullish scenario strengthens if the ad tier continues doubling and buybacks keep pace, while the setup weakens if FY26 guidance slips or FCF conversion deteriorates materially. Given 71% bullish analyst coverage and zero sell ratings, the risk/reward is skewed to the upside.
Year 24/7 Wall St. Price Target 2026 $107.69 2027 $203.13 2028 $356.49 2029 $506.13 2030 $633.50 These projections assume Netflix continues executing on advertising growth, pricing power, and buybacks. Significant upside or downside could come from large-scale M&A or a step-change in streaming competition.
Contact [email protected] for any questions or corrections.
Here's an odd pair of facts. Netflix (NFLX +2.35%) has never made more money than it is making right now -- net income over the past four reported quarters totals about $13.65 billion, comfortably above the record $10.98 billion the company earned in all of 2025. And yet the stock has fallen about 35% from its 52-week high of $126.71, trading near $82 as of this writing -- and that's after a bounce from about $72 early this month.
Profits are at an all-time high, and shares down by more than a third.
Is this a buying opportunity?
Image source: The Motley Fool.
The profit record holds upOne qualification first. That trailing profit includes a one-time boost: a $2.8 billion pre-tax termination fee (roughly $2.3 billion after tax) that Netflix collected in the first quarter, when its agreement to buy Warner Bros. Discovery's studios and streaming business ended, after Warner Bros. Discovery accepted a rival's higher offer. That money counts, but it won't repeat.
Set it aside, and the record still stands on the operating line. Netflix's operating income over the past four quarters totals about $14.4 billion, ahead of the $13.3 billion it generated in all of 2025.
And the operating trend is still improving. Second-quarter operating income rose 11% year over year to $4.2 billion, and management continues to forecast a 31.5% operating margin for 2026, expanding from 29.5% last year. The company's own outlook implies operating income growth of more than 20% this year.
In other words, whatever the market is worried about, it isn't the profit engine. That part keeps getting better.
The growth rate did changeWhat changed is the top line's speed. Netflix's year-over-year revenue growth peaked at 17.6% in the fourth quarter of 2025. It slowed to 16.2% in the first quarter of this year, then to 13.4% in the second. For the third quarter, management forecasts 11.7% growth (a clear deceleration, even if a gradual one).
For the full year, management's revenue outlook of $51.0 billion to $51.4 billion implies 13% to 14% growth for 2026, with advertising revenue -- roughly doubling to about $3 billion -- doing part of the work.
That's still healthy growth for a company this size. But it's a different trajectory than the one investors were paying for at the high. At $126.71, the stock traded at about 50 times its 2025 earnings of $2.53 per share -- a price-to-earnings multiple that only made sense if mid-to-high-teens revenue growth kept compounding for years to come. By the time management's slower-growth outlook was on the table, the market had cut that price-to-earnings multiple by more than a third, measured on earnings adjusted for the one-time fee.
Today, the stock's price-to-earnings ratio is about 25 as reported, or about 31 with the fee stripped out, and shares trade at about 21 times expected 2027 earnings. Same company, record profits, a much smaller price tag per dollar of earnings.
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Moneyball Superscore
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Overall, I do think the sell-off that got shares to where they are today was justified. But I also don't think shares are cheap enough to make them a buy.
A multiple of 50 times earnings was pricing Netflix for a growth era that management itself says is moderating. The repricing since then isn't the market malfunctioning. It's the market updating its view to reflect a maturing business.
Now shares arguably look priced about right, trading about 21 times expected 2027 earnings. That's a reasonable price tag for a business forecasting 20%-plus operating income growth with advertising revenue on track to double. Additionally, Netflix remains arguably the best-positioned company in streaming.
Still, I think shares are priced more like a hold than a buy here. After all, growth could decelerate further in 2027 (management hasn't guided that far out), and competition for viewing time isn't letting up.
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Amy Reinhard, Netflix's advertising president. Katie Jones/Variety via Getty Images Netflix is shaking up its ads leadership.
Jon Whitticom, a prominent Netflix exec who helped build the streamer's advertising business, is leaving the organization, according to a memo viewed by Business Insider.
Advertising president Amy Reinhard shared the news with staff last week, saying she had "decided to part ways" with Whitticom. She added that ads product exec Marc Heneghan would lead the unit on an interim basis while a search is conducted for Whitticom's replacement.
"At Netflix, we expect our leaders to build and maintain trust, share context generously, collaborate cross-functionally, and cultivate an environment where people can do their best work," she wrote. "Jon and I have discussed these needs directly over time, and my decision reflects this standard now and going forward."
The ads business is one of the key levers Netflix is leaning on for growth, along with live sports and creator content, as Wall Street worries about the streamer's US engagement growth slowing. The company said this year that in countries where it offers an ads tier, more than 60% of new subscribers choose its cheaper, ad-supported plan.
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Whitticom, Netflix's VP of ads product, started as an ad platform advisor in early 2023. His appointment was closely watched because of its potential to help Netflix decide how to level up its then-nascent advertising business. He previously was chief product officer at Comcast-owned ad startup FreeWheel.
Under Whitticom, Netflix built out its ad tech and enabled advertisers to buy its ads through other companies like Google, The Trade Desk, and Magnite. The buildout has also had bumps along the way, with multiple leadership changes and competing internal visions over how to grow the business.
"Speed got us from zero to one," Reinhard wrote in her memo. "Getting to what's next means knowing when to move fast and how to do it together."
Netflix has said it expects to hit $3 billion in ad revenue this year, nearly doubling its 2025 haul. The company is also introducing new ad formats and expanded ways for advertisers to buy inventory, Reinhard said in an announcement concluding its Upfront sales process, where TV companies pitch big advertisers for extensive ad deals.
Here's the full memo from Reinhard:
Team,I wanted to let you know about a leadership change I'm making to better reflect the needs of the business and the growth ahead in Ads.After careful consideration, I've decided to part ways with Jon Whitticom, and today will be his last day. Jon helped build Ads Product from the ground up and led the launch of the Netflix Ads Suite last year, a major milestone for our business and Netflix. I'm grateful for all his contributions over the past two-plus years.At Netflix, we expect our leaders to build and maintain trust, share context generously, collaborate cross-functionally, and cultivate an environment where people can do their best work. Jon and I have discussed these needs directly over time, and my decision reflects this standard now and going forward. Speed got us from zero to one. Getting to what's next means knowing when to move fast and how to do it together.Marc Heneghan will lead Ads Product on an interim basis while I immediately begin an external search for a new leader. All of Jon's directs will now report to Marc.There's never a good moment for a change like this; I know it often carries risk and disruption. But I also know this team is resilient and our foundation is strong. What isn't changing are our priorities as a business, or my confidence in this team's ability to stay focused on the bigger picture and maintain our momentum on our near-term deliverables.I will host separate sessions with the Ads Product team and the Ads Platform teams to talk through our path forward and answer any questions. Those teams should look out for a calendar invite to join a session.Please join me in thanking Jon and wishing him the best in the future.Best,Amy
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Lucia Moses You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Lucia Moses covers the media and entertainment business, with a focus on how creators build businesses, how media companies intersect with creators, and how marketers adopt entertainment tools. She's broken stories about MrBeast's ambitions, Google's movie initiative, and Netflix's push into podcasts.She previously reported on media and managed teams at Digiday and Adweek.
The streamer is discussing bringing rival services onto its platform.
08/24/2026 12:28
Summary
Netflix has reportedly held talks about offering Peacock and Fox One.
Netflix Inc. (NFLX, Financials) may reconsider a streaming strategy rule. According to The New York Times, the business has considered adding Comcast's Peacock and Fox One to its platform. Netflix may integrate competing content or offer memberships, but no deal is imminent.
Nonetheless, the talks are notable. Netflix rarely sells competitive streaming services. In contrast, Amazon, Roku, and YouTube sell third-party subscriptions to become users' major gateways. That model is growing.
Antenna believes that one-third of new streaming subscriptions have come from third-party services, up 60% over the past three years. Netflix has tried several things. It added live and on-demand TF1 programming in June.
The appeal is straightforward. Netflix could increase engagement and solidify its position as the default streaming destination if it allowed consumers to manage other subscriptions and watch its own series.
Partners may share revenue and lose client control. Netflix must decide if being the biggest streaming service is enough or if it wants to be the streaming front door.
Disclosures
I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.
Netflix roste díky snaze o širší streamingová partnerství a posilování nabídky pro tvůrce, zatímco čelí tlaku na zdražování předplatného. Akcie byly v pondělí výše o 0,74 % na 80,18 USD.
Netflix Inc (NASDAQ:NFLX) stock traded higher by almost a percent on Monday as buyers lean into relative strength in Communication Services even while the broader tape stays risk-off.
The Nasdaq is down 1.14% while the S&P 500 has shed 0.40%.
The streaming giant is expanding its streaming strategy as it explores third-party partnerships, faces growing limits on subscription price increases and intensifies its battle with Alphabet Inc (NASDAQ:GOOGL) (NASDAQ:GOOG) YouTube for top creators and younger viewers.
• Netflix stock is trading at depressed levels. What’s next for NFLX stock?
Netflix Explores Broader Streaming Partnerships as Competition IntensifiesNetflix executives have discussed bringing third-party streaming services such as Peacock and Fox One into the Netflix app, although no deal is imminent.
Co-CEO Greg Peters said the company is seeing "promising" results from its TF1 partnership in France and would consider similar arrangements if they benefit Netflix, its members and partners, the New York Times reported on Monday.
Pricing Pressure Tests Subscriber LimitsNetflix and other major streamers have raised subscription prices sharply in Western Europe, although Ampere Analysis senior research manager Jaanika Juntson said the size of price increases is falling as consumers approach their willingness-to-pay limits, the Guardian reported on Monday.
Netflix U.K. revenue reached 2.06 billion pounds ($2,808,624,929) last year, up 11%, while pre-tax profit rose to 72.5 million pounds ($98,847,236).
YouTube Pushes Back Against Netflix’s Creator StrategyNetflix is also pursuing popular YouTube creators to attract younger audiences and increase viewing time. In response, YouTube has discussed paying major channels for temporary exclusivity and reducing marketing support for creators who simultaneously distribute content on Netflix, highlighting intensifying competition between the two platforms, Bloomberg reported on Thursday.
Top ETF Exposure State Street Communication Services Select Sector SPDR ETF (NYSE:XLC): 4.52% Weight REX FANG & Innovation Equity Premium Income ETF (NASDAQ:FEPI): 6.68% Weight Monarch Blue Chips Core Index ETF (BATS:MBCE): 4.54% Weight Significance: Because Netflix carries such a heavy weight in these funds, any significant inflows or outflows for these ETFs will likely force automatic buying or selling of the stock.
NFLX Price ActionNetflix shares were up 0.74% at $80.18 at the time of publication on Monday, according to Benzinga Pro data.
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The global streamer has posted £2.06B ($2.81B) revenues for full-year 2025, meaning it generated more cash than the country’s leading commercial broadcaster, ITV, and is well ahead of smaller PSB rivals Channel 4 (£1B) and Paramount-owned 5 (£318M). The BBC‘s is funded by the licence fee and does not account in a comparable way.
Netflix’s revenue grew 11.3% from the £1.85B posted in 2024, according to a Companies House filing, with the growth pegged primarily to 7% growth in the average number of paying customers and “higher average monthly revenue” per paying member.
The 2025 figure compares with the £1.9B ITV’s media and entertainment made in its latest full-year results. The division, which houses ITV’s channel suite and streamer ITVX, is being sold to Sky. When production wing ITV Studios is added in, ITV plc posted revenues of £4.12B.
Netflix UK‘s operating profit for the financial year ended December 31, 2025, was £44.9M, up slightly on the £43.2M the year before, with profit after tax coming in at £53.3M, up 11.5%.
The news will surely be a big talking point at the final Edinburgh Television Festival this week in the Scottish capital, where Netflix and the UK’s other major streamers and broadcasters will take to stage to talk to the industry. Netflix UK’s Doc Series boss, Adam Hawkins, is the fest’s advisory chair this year.
Netflix launched in the UK in 2012 as part of its first expansion into Europe, and has since grown into one of the dominating forces in British broadcasting through shows such as Baby Reindeer, The Gentlemen and Adolescence.
With the BBC’s licence fee model in crisis, the idea of forcing streamers to support the UK’s leading public broadcaster in collecting its funding. The Motion Picture Association, which represents Netflix and the U.S. studios, has slammed the idea and even BBC Director General Matt Brittin has admitted the plan would be “difficult” to enforce.
Earlier this year, regulator Ofcom’s Media Nations report revealed Netflix was ahead of the BBC, ITV and YouTube as the service viewers first thought of when deciding what to watch. The number of 16-24s choosing the streamer first was further ahead of rivals.
The filing to Companies House showed that Netflix Services UK Limited, the company Netflix uses to house its earnings in Britain, distributed interim dividends of £30M on July 21, 2025. It also increased the amount loaned from Netflix to nearly £400M, with an extended maturity date of August 1, 2028, and became a subsidiary of Amsterdam-based Netflix International, which merged with Netflix Services Holdings in May last year.
According to the filing, Netflix employed an average of 342 staff in the UK in 2025, up from 263 the year before.
Netflix uvedl tržby za 2Q 2026 ve výši 12,56 miliardy USD, meziročně o 13,37 % více, a EPS 0,80 USD překonal konsensus. Společnost zároveň potvrdila celoroční výhled tržeb 51 až 51,4 miliardy USD.
Netflix (NASDAQ:NFLX | NFLX Price Prediction) has been one of 2026’s most punished megacaps, and the setup is starting to look asymmetric. With shares at $80.44 and free cash flow guidance of roughly $12.5 billion for the year, our proprietary model calls for sharp mean reversion.
Our 24/7 Wall St. price target for Netflix is $177.34, implying 121% upside over the next 12 months. Our recommendation is buy with high model confidence.
24/7 Wall St. Price Target Summary Metric Value Current Price $80.44 24/7 Wall St. Price Target $177.34 Upside +121.0% Recommendation BUY Confidence Level 90% How a Streaming Leader Ended Up in the Bargain Bin Netflix lost roughly a third of its value over the past year, down 33.93% from $121.42 a year ago and 14.44% lower year to date. Shares have stabilized, gaining 18.67% in the past month off a 52-week low of $65.08.
Q2 2026 delivered revenue of $12.56 billion up 13.37% and EPS of $0.80 beating the $0.7883 consensus. Management guided full-year revenue to $51 to $51.4 billion with a 31.5% operating margin target. The stock was punished more for engagement-data disclosure changes than any operational miss.
Why Bulls See a Breakout Ahead Netflix’s addressable market is enormous relative to current penetration. CFO Spence Neumann said Netflix reaches an audience “approaching a billion people” while capturing just 7% of a $670 billion addressable revenue market and 5% of global TV view share.
Advertising revenue is on pace to roughly double to $3 billion in 2026, with advertiser count up 70% year over year. Buybacks are aggressive, with $4.7 billion repurchased in Q2 (a company record) and $27.1 billion remaining under authorization. Our bull case models to $191.03.
What Could Go Wrong The bear case is a valuation reset. Q2 free cash flow declined 32.73% to $1.53 billion, and Q1 EPS missed by 8.55%. Bulls counter that FCF decline reflects higher cash taxes tied to the $2.80 billion Warner Bros. termination fee and front-loaded content amortization, with underlying economics intact.
Competition from Alphabet, Amazon, Disney, and TikTok remains structural, and $1 billion of debt matures later this year. Reddit’s composite sentiment is bearish at 38, and insider activity is net selling. Our bear case still lands at $141.71, well above spot.
How Netflix Compares to Disney and Spotify Walt Disney (NYSE:DIS) is the direct streaming rival. Disney trades at a P/E of 15 with operating margin of 14.6%, versus Netflix’s 33.4%. Disney is cheaper on earnings, but Netflix earns roughly double the margin and delivers 42.76% ROE against Disney’s 11.78%. That gap justifies a premium multiple.
Spotify (NYSE:SPOT) is the closest pure-play subscription comp. Spotify trades at P/E near 50 with operating margin of 12.8%, roughly double Netflix’s multiple on materially thinner profitability. If Spotify deserves that multiple on subscription growth, Netflix at 24 times forward earnings looks conservatively priced. The peer set makes our $177.34 target look reasonable.
Company P/E Operating Margin Netflix 24 33.4% Disney 15 14.6% Spotify 50 12.8% Buy the Reset Reiterating the 24/7 Wall St. price target of $177.34, a buy rating, and 90% model confidence. A business generating $12.5 billion of free cash flow with expanding margins should not trade at 25 times forward earnings for long.
The bull thesis holds if ad revenue continues tracking to double this year. The setup weakens if content amortization growth reaccelerates into 2027.
Year 24/7 Wall St. Price Target 2026 $105.84 2027 $175.30 2028 $318.93 2029 $467.36 2030 $600.43 These projections assume Netflix executes on advertising, live programming, and gaming while sustaining pricing power. Meaningful downside could result from subscriber saturation in developed markets or a competitive shock from a well-funded rival.
Contact [email protected] for any questions or corrections.
Netflix míří letos na zhruba 3 miliardy USD z reklamních příjmů, což je asi dvojnásobek proti loňsku. U amerického upfrontu téměř zdvojnásobil reklamní závazky.
Key Takeaways Netflix is targeting roughly $3 billion in ad revenues, about double the prior year's figure.Netflix nearly doubled U.S. upfront ad commitments, with FIFA Women's World Cup sponsorships sold out.Expanded programmatic tools and a low-cost ad tier are widening Netflix's monetizable advertising base. Netflix (NFLX - Free Report) continues to sharpen its advertising business as a driver of revenue expansion, remaining on track to deliver approximately $3 billion in ad revenues this year, roughly double the prior year figure. The gap between average revenue per membership on the ad-supported tier and the standard ad-free plan continues to narrow. This gap represents a direct opportunity for incremental revenues as advertising capabilities mature.
Netflix is expanding its demand sources. The company continues to build out its proprietary Netflix Ads Suite and broader programmatic capabilities. In the second quarter of 2026, it expanded its AI-powered tools across the full advertising lifecycle, spanning planning, creative production, campaign management and reporting. Netflix is also extending programmatic access to Pause Ads and live inventory, widening participation from smaller advertisers.
Accessibility is reinforcing this growth path. Netflix's ad-supported plan in the United States is priced at $8.99, functioning as a low-cost entry point that continues to draw new members into the ecosystem while widening the base against which advertising inventory can be monetized.
Live programming is reinforcing advertiser demand. Netflix closed its 2026 U.S. upfront in August, nearly doubling ad commitments from the prior year. Game sponsorships for the 2027 FIFA Women's World Cup are fully sold out, with in-game inventory nearly exhausted as well. Advertisers are also showing strong interest in NFL, WWE and MLB programming.
NFLX is guiding 13% to 14% revenue growth for 2026, with advertising expected to complement subscription growth from memberships and pricing. As ad tech investment and live event demand continue to build, Netflix's advertising business is positioning itself to become an increasingly material contributor to overall revenue expansion.
How NFLX is Placed Against PeersNetflix's advertising push mirrors similar strategies at Disney (DIS - Free Report) and Warner Bros. Discovery (WBD - Free Report) . Disney is leaning on its ad-supported reach across Disney+, Hulu and ESPN+ to strengthen streaming profitability, while Warner Bros. Discovery is expanding ad-tier distribution across its Max platform to support margin gains.
Both Disney and Warner Bros. Discovery are treating advertising as a central lever for improving per-user economics, an approach broadly consistent with Netflix's own strategy. However, Netflix's expansive live sports slate and upfront momentum position it to build advertiser demand at a pace that compares favorably against both Disney and Warner Bros. Discovery going forward.
NFLX’s Price Performance, Valuation & EstimatesShares of Netflix have declined 17.1% year to date, underperforming both the Zacks Broadcast Radio and Television industry and the Zacks Consumer Discretionary sector’s fall of 13.7% and 7.6%, respectively.
NFLX’s YTD Share Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, Netflix appears overvalued, trading at a forward 12-month price-to-earnings ratio of 20.77X, higher than the sector’s 16.42X. NFLX carries a Value Score of D.
NFLX’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NFLX’s 2026 earnings is pegged at $3.59 per share, down by a penny over the past 30 days. This indicates a 41.9% increase from the previous year.
NFLX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Akcie Netflixu vzrostly v úterý v poledním obchodování o 4 % poté, co Pershing Square Billa Ackmana oznámila novou pozici. Akcie jsou ale letos stále o 16 % níže.
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Netflix (NASDAQ:NFLX | NFLX Price Prediction) shares are up 4% to $78.80 in Tuesday midday trading after Bill Ackman’s Pershing Square disclosed a new position in the streaming company. The catalyst stands out because Netflix stock is climbing well ahead of its closest streaming peers on the day.
Shares are still down 16% year to date (YTD) through Monday’s close, and the stock has fallen 37% over the past year. The rally partially offsets that decline. What makes the trade notable is that Ackman previously owned this same name in 2022 and exited at a loss.
Ackman’s Pershing Square Rebuilds a Netflix Position In its Q2 2026 investor letter, Pershing Square laid out its Netflix thesis directly. Ackman has separately stated that Netflix has “won the streaming wars”:
We acquired a position in Netflix, a business we briefly owned in 2022 and have followed closely ever since. Netflix is the dominant global streaming platform with over 325 million subscribers, nearly double the combined base of its two closest competitors, Disney+ and HBO Max. When we first invested in early 2022, investors feared an escalating content arms race among a crowded field of streaming entrants. At the same time, cash content spend substantially exceeded content amortization, weighing on free cash flow. The launch of a previously disavowed advertising tier added further uncertainty.
Pershing Square filed under Schedule 13G on August 14, days before the news catalyzed Tuesday’s move. That filing carries a passive intent designation, though the 2022 attempt ended in a loss, which sits in tension with the current re-entry.
Streaming Peers Barely Move Disney (NYSE:DIS) stock is up 0.9% to $104.51 on Tuesday. The parent runs Disney+ and Hulu alongside ESPN and its Experiences theme park and cruise business, and Disney stock is down 8% YTD through Monday’s close.
Warner Bros. Discovery (NASDAQ:WBD) shares are up 0.4% to $28.04. The company operates HBO Max and discovery+ alongside its Studios and Global Linear Networks segments, and WBD stock is down 3% YTD through Monday’s close.
Both are the specific competitors Ackman’s letter names, which is why their near-flat trading is the point. Investors are treating this as news about Netflix’s shareholder register, not the competitive balance in streaming.
Sector ETF Signal Communication Services Select Sector SPDR Fund (NYSEARCA:XLC) shares are up 0.3% to $111.18. Netflix is a constituent of the fund, and the near-flat print against Netflix’s gain shows how a single holding’s move dilutes across the basket. The ETF is not leveraged, and it concentrates in a handful of large communication names, which further muffles idiosyncratic moves.
The fund is down 5% YTD through Monday’s close. That trajectory sits closer to Disney’s and Warner Bros. Discovery’s than to Netflix’s, which confirms the sector did not reprice on Tuesday.
Valuation and Analyst Picture Netflix stock carries a trailing P/E ratio of 28.83x on a market capitalization of roughly $328.1 billion. Disney stock trades at 14.41x, so the bull case here leans on dominance rather than cheapness. That gap is the counterweight to any thesis built on a cheap starting multiple.
Sell-side coverage runs strongly positive. On a 1-to-5 scale, Netflix stock has an average brokerage recommendation of 1.63 from 50 firms, between Strong Buy and Buy. Zacks assigns a Rank of 3, or Hold, with the current-year consensus earnings estimate unchanged at $3.59 over the past month.
The streamer operates in more than 190 countries approaching 1 billion members, produces originals in more than 50 countries, and has expanded into live NFL games, boxing, MLB events and WWE programming. Some 144 hedge fund portfolios held Netflix at the end of Q1 2026, down from 146 the prior quarter.
What to Watch Next The open questions center on whether Netflix’s ad-tier revenue scales, whether subscriber growth stabilizes, and whether estimate revisions turn higher. Pershing Square’s first attempt at this trade ended in a loss in 2022, which sits in tension with Ackman’s dominance argument.
Investors could look for signs that ad-tier monetization is accelerating alongside membership additions. Traders may want to keep an eye on whether Netflix stock holds above recent levels into the next round of estimate revisions.
Contact [email protected] for any questions or corrections.
Netflix v pondělí oslabil o 2,14 % na 76,49 USD, protože trh dál tlačí slabší výhled pro 3. čtvrtletí i celý rok. Tržby za 3. čtvrtletí mají činit 12,86 miliardy USD, což je pod odhadem Wall Street 13,01 miliardy USD.
Netflix Inc. (NASDAQ:NFLX) stock traded lower on Monday as structural headwinds from its second-quarter guidance continued to depress the share price. The decline comes despite a brief lift last Thursday following disclosures from Pershing Square Capital Management.
The Nasdaq is up 0.14% while the S&P 500 has shed 0.15% and Communication Services is down 0.7%.
• Netflix stock is facing resistance. Why is NFLX stock retreating?
Pershing Square Discloses New PositionBillionaire investor Bill Ackman re-entered Netflix, acquiring 3.15 million shares. The new position makes up 4.9% of Pershing Square’s portfolio. Ackman previously exited Netflix in 2022 with a $400 million loss after purchasing over $1 billion in stock at $400 per share and selling at $225 per share.
Pershing Square stated that “Netflix has since effectively won the streaming wars” and noted the stock’s “current valuation multiple represents a substantial discount.”
Second-Quarter Revenue Misses EstimatesOn July 16, Netflix reported second-quarter revenue of $12.56 billion, missing the Street consensus estimate of $12.59 billion despite rising 13% year-over-year. UCAN revenue hit $5.43 billion (+10%), EMEA reached $4.03 billion (+14%), LATAM generated $1.58 billion (+21%) and APAC totaled $1.51 billion (+16%).
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Earnings per share came in at 80 cents, beating the Street estimate of 79 cents. View hours grew 2% year-over-year in the first half of 2026. Live programming accounted for 5% of 2026 content spend and 1% of view hours, while ad-related revenue remains on track to top $3 billion for 2026.
Soft Guidance Triggers PressureMarket sentiment remains tied to conservative forward guidance. Netflix projects third-quarter revenue of $12.86 billion (12% year-over-year growth), falling below Street estimates of $13.01 billion.
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Expected third-quarter earnings of 82 cents per share also lag behind the Street consensus of 84 cents. Additionally, Netflix narrowed its full-year revenue outlook to $51 billion–$51.40 billion from $50.70 billion–$51.70 billion, compared to the Street estimate of $51.41 billion.
NetFlix Technical Levels to WatchFrom a trend perspective, Netflix is trying to stabilize in the short term, trading above its 20-day SMA ($73.25) and 50-day SMA ($74.75), but it remains 7.9% below its 100-day SMA ($83.54) and 13.6% below its 200-day SMA ($89.04). That "short-term bounce inside a longer-term downtrend" setup often creates choppy tape, especially with the 20-day SMA still below the 50-day SMA (a bearish alignment).
Key Resistance: $78.50 Key Support: $71 NFLX Stock Price Activity: Netflix shares were down 2.14% at $76.49 at the time of publication on Monday, according to Benzinga Pro data.
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Avalon Trust Co bought a new position in shares of Netflix, Inc. (NASDAQ:NFLX – Free Report) during the second quarter, according to its most recent filing with the Securities & Exchange Commission. The institutional investor bought 264,958 shares of the Internet television network’s stock, valued at approximately $18,918,000. Netflix makes up 1.2% of Avalon Trust Co’s investment portfolio, making the stock its 25th largest position.
Several other hedge funds have also modified their holdings of the stock. Vanguard Group Inc. lifted its holdings in Netflix by 912.5% in the fourth quarter. Vanguard Group Inc. now owns 390,014,981 shares of the Internet television network’s stock valued at $36,567,805,000 after buying an additional 351,493,659 shares during the period. State Street Corp grew its holdings in Netflix by 927.6% during the 4th quarter. State Street Corp now owns 176,780,995 shares of the Internet television network’s stock worth $16,574,986,000 after acquiring an additional 159,578,053 shares during the period. Geode Capital Management LLC grew its holdings in Netflix by 892.0% during the 4th quarter. Geode Capital Management LLC now owns 99,598,678 shares of the Internet television network’s stock worth $9,305,336,000 after acquiring an additional 89,558,684 shares during the period. Capital World Investors raised its position in shares of Netflix by 859.1% during the 4th quarter. Capital World Investors now owns 89,341,444 shares of the Internet television network’s stock valued at $8,376,656,000 after acquiring an additional 80,025,890 shares during the last quarter. Finally, Price T Rowe Associates Inc. MD lifted its stake in shares of Netflix by 685.8% in the 4th quarter. Price T Rowe Associates Inc. MD now owns 86,058,878 shares of the Internet television network’s stock valued at $8,068,882,000 after purchasing an additional 75,107,069 shares during the period. 80.93% of the stock is owned by institutional investors.
Analyst Ratings Changes
Several research firms have recently issued reports on NFLX. Sanford C. Bernstein set a $95.00 price target on Netflix and gave the stock an “outperform” rating in a research report on Friday, July 17th. Pivotal Research cut their target price on Netflix from $96.00 to $70.00 and set a “hold” rating on the stock in a research note on Friday, July 17th. Barclays reduced their target price on Netflix from $85.00 to $80.00 and set an “equal weight” rating on the stock in a report on Friday, July 17th. Raymond James Financial restated a “market perform” rating on shares of Netflix in a research report on Thursday, May 14th. Finally, Morgan Stanley reaffirmed an “overweight” rating and issued a $90.00 price target (down from $115.00) on shares of Netflix in a research note on Tuesday, July 14th. Four equities research analysts have rated the stock with a Strong Buy rating, thirty-four have assigned a Buy rating, sixteen have issued a Hold rating and one has assigned a Sell rating to the company. According to data from MarketBeat.com, Netflix currently has a consensus rating of “Moderate Buy” and a consensus price target of $103.48.
Read Our Latest Stock Analysis on Netflix
Netflix Stock Performance
Shares of Netflix stock opened at $78.16 on Friday. The stock’s fifty day simple moving average is $74.67 and its 200 day simple moving average is $84.54. The company has a current ratio of 1.14, a quick ratio of 1.14 and a debt-to-equity ratio of 0.39. The company has a market capitalization of $325.45 billion, a PE ratio of 24.60, a PEG ratio of 0.98 and a beta of 1.52. Netflix, Inc. has a 12 month low of $65.08 and a 12 month high of $126.71.
Netflix (NASDAQ:NFLX – Get Free Report) last posted its earnings results on Thursday, July 16th. The Internet television network reported $0.80 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.79 by $0.01. The firm had revenue of $12.56 billion during the quarter, compared to analysts’ expectations of $12.58 billion. Netflix had a return on equity of 40.02% and a net margin of 28.22%.The company’s revenue was up 13.4% on a year-over-year basis. During the same period in the previous year, the firm earned $0.72 earnings per share. On average, research analysts predict that Netflix, Inc. will post 3.59 EPS for the current year.
Insiders Place Their Bets
In related news, CEO Theodore A. Sarandos sold 105,850 shares of the stock in a transaction that occurred on Monday, August 3rd. The stock was sold at an average price of $73.03, for a total transaction of $7,730,225.50. Following the completion of the sale, the chief executive officer directly owned 206,266 shares of the company’s stock, valued at approximately $15,063,605.98. This represents a 33.91% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CFO Spencer Adam Neumann sold 9,248 shares of the firm’s stock in a transaction that occurred on Monday, August 10th. The stock was sold at an average price of $75.79, for a total transaction of $700,905.92. Following the sale, the chief financial officer owned 73,787 shares in the company, valued at $5,592,316.73. This trade represents a 11.14% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold 600,295 shares of company stock worth $49,056,671 in the last three months. 1.24% of the stock is owned by corporate insiders.
Key Stories Impacting Netflix
Here are the key news stories impacting Netflix this week:
Positive Sentiment: Bill Ackman’s Pershing Square disclosed a new Netflix position of approximately 3.15 million shares, representing about 4.9% of the fund’s portfolio. Ackman said Netflix has effectively “won the streaming wars,” renewing investor interest after the stock’s major sell-off. Reuters article
Positive Sentiment: Analysts and investing commentators point to Netflix’s resilient fundamentals: second-quarter revenue rose 13.4% year over year to $12.6 billion, earnings per share slightly exceeded estimates, and profitability remained strong. The advertising business, expanding margins and a valuation viewed as reasonable relative to growth are supporting the bullish case. Zacks article
Positive Sentiment: Netflix’s continued push into live sports—including an MLB “Field of Dreams” game—and the extension of its Seinfeld agreement could strengthen engagement, advertising opportunities and content retention. MLB live sports article
Neutral Sentiment: Institutional positioning is mixed: some large investors added shares while others reduced holdings. Analysts’ reported price targets remain above the current market level, but investors still must weigh valuation and slowing growth expectations.
Negative Sentiment: Netflix closed its Hollywood-based Night School gaming studio and plans to close Helsinki-based Moonloot. The closures may improve focus and reduce costs, but they also raise questions about the company’s gaming strategy and ability to expand beyond streaming. Los Angeles Times article
Negative Sentiment: Reported insider trading shows 30 Netflix open-market sales and no purchases over the past six months. While such sales may reflect compensation or diversification, the one-sided pattern can weigh on sentiment and contrasts with Ackman’s new bullish position. Quiver Quantitative article
Netflix Company Profile
(Free Report)
Netflix, Inc (NASDAQ: NFLX) is a global entertainment company that provides subscription-based streaming of films, television series, documentaries and other video content. Founded in 1997 by Reed Hastings and Marc Randolph and headquartered in Los Gatos, California, the company began as a DVD-by-mail rental service and introduced streaming video in 2007. Netflix later expanded into producing and distributing original programming, beginning notable original hits in the 2010s, and now operates a content production and distribution ecosystem alongside its licensing activity.
The company’s primary product is its on-demand streaming service, which can be accessed on a wide range of internet-connected devices and delivered through a suite of apps and web platforms.
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Want to see what other hedge funds are holding NFLX? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Netflix, Inc. (NASDAQ:NFLX – Free Report).
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Netflix stále roste: ve čtvrtletí výnosy stouply o 13 % na 12,6 miliardy USD. Akcie jsou ale asi 38 % pod 52týdenním maximem kvůli vyšším očekáváním investorů.
Netflix (NFLX -0.10%) has become one of the more interesting stocks in the market right now. Its shares have fallen sharply from their highs, leaving many investors wondering whether something has gone seriously wrong with the business.
But here's the surprising part: Netflix's business is still growing. In its latest quarter, Netflix generated $12.6 billion of revenue, up 13% year over year . So why has the stock fallen so much?
The answer is more complicated than a "weak" quarter.
Image source: Getty Images.
Netflix became a victim of its own success. For years, Netflix was one of the market's favorite growth stocks.
The company transformed entertainment, expanded globally, and built a streaming platform with hundreds of millions of members. Investors rewarded that success with a premium valuation because they expected Netflix to keep growing rapidly for years.
But Netflix is no longer the same company it was a decade ago. It already operates at an enormous scale -- more than 300 million subscribers. Adding another 100 million members becomes increasingly difficult when the company already serves a massive global audience.
That doesn't mean Netflix has stopped growing. Its Q2 results prove otherwise. The issue is that investors have started asking a different question: How much growth is realistically left?
That question matters because a stock price reflects expectations about the future, not just today's results. A company can grow its profits and still see its stock fall if investors decide those profits are worth a lower price.
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The business is healthy, but the bar is higher. Netflix's latest numbers make it difficult to argue that the underlying business is in trouble.
Revenue increased 13% year over year in Q2, while operating income increased 11%. More importantly, management expects operating income to grow by more than 20% in 2026, with the operating margin reaching 31.5%, up from 29.5% in 2025.
Engagement also remains healthy. Netflix said members watched more than 97 billion hours during the first half of 2026, up 2% from the same period last year, despite competition from major events such as the Winter Olympics and the World Cup.
That is hardly a broken business. But investors now expect Netflix to do more than simply grow.
The company needs to show that it can continue raising prices without hurting engagement, expand margins, and create new revenue streams from its enormous audience.
That brings us to advertising.
Advertising could determine what happens next. Netflix's advertising business has become increasingly important to the investment story.
Management expects advertising revenue to roughly double in 2026 to about $3 billion. That would still represent only a small portion of Netflix's overall revenue, but the opportunity is set to grow much larger over time.
The company is expanding its advertising technology, improving targeting and measurement, and opening more of its inventory to programmatic buyers. If Netflix succeeds, advertising could give the company a powerful new way to monetize its existing audience.
That matters because Netflix no longer needs to rely entirely on adding subscribers. It can raise prices. It can increase advertising revenue. It can improve margins. The more money Netflix earns per member, the less explosive subscriber growth it needs to generate strong earnings growth.
What does it mean for investors? Netflix stock has fallen sharply, trading down about 38% from its 52-week high, but investors should be careful not to confuse a falling stock price with a deteriorating business.
The latest numbers tell a different story. Netflix is still growing. Profitability remains strong. Engagement is healthy. Advertising is gaining momentum.
The real issue is a change in investors' expectations. Investors once paid a premium for Netflix because they believed exceptional growth would continue for years. Today, they are demanding more proof that Netflix can maintain strong growth at its enormous scale.
That makes the next phase particularly important. If Netflix can sustain double-digit revenue growth, expand margins, and turn advertising into a meaningful profit engine, the recent sell-off could eventually look more like a valuation reset than a fundamental breakdown.
But if growth slows materially and advertising fails to meet expectations, the market's caution may prove justified.
All that said, investors should pay attention to execution in the coming quarters.
BIP Wealth LLC purchased a new stake in shares of Netflix, Inc. (NASDAQ:NFLX – Free Report) during the 2nd quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission. The institutional investor purchased 20,759 shares of the Internet television network’s stock, valued at approximately $1,482,000.
Several other institutional investors have also recently added to or reduced their stakes in the business. Vanguard Group Inc. lifted its stake in Netflix by 912.5% in the fourth quarter. Vanguard Group Inc. now owns 390,014,981 shares of the Internet television network’s stock valued at $36,567,805,000 after buying an additional 351,493,659 shares during the last quarter. State Street Corp raised its holdings in shares of Netflix by 927.6% during the fourth quarter. State Street Corp now owns 176,780,995 shares of the Internet television network’s stock valued at $16,574,986,000 after buying an additional 159,578,053 shares during the last quarter. Geode Capital Management LLC boosted its position in shares of Netflix by 892.0% during the fourth quarter. Geode Capital Management LLC now owns 99,598,678 shares of the Internet television network’s stock worth $9,305,336,000 after buying an additional 89,558,684 shares during the period. Capital World Investors grew its holdings in Netflix by 859.1% in the 4th quarter. Capital World Investors now owns 89,341,444 shares of the Internet television network’s stock worth $8,376,656,000 after buying an additional 80,025,890 shares in the last quarter. Finally, Morgan Stanley increased its position in Netflix by 903.0% in the 4th quarter. Morgan Stanley now owns 85,349,973 shares of the Internet television network’s stock valued at $8,002,414,000 after acquiring an additional 76,840,318 shares during the period. Institutional investors own 80.93% of the company’s stock.
Key Headlines Impacting Netflix
Here are the key news stories impacting Netflix this week:
Positive Sentiment: Bill Ackman’s Pershing Square disclosed a new Netflix position of approximately 3.15 million shares, representing about 4.9% of the fund’s portfolio. Ackman said Netflix has effectively “won the streaming wars,” renewing investor interest after the stock’s major sell-off. Reuters article
Positive Sentiment: Analysts and investing commentators point to Netflix’s resilient fundamentals: second-quarter revenue rose 13.4% year over year to $12.6 billion, earnings per share slightly exceeded estimates, and profitability remained strong. The advertising business, expanding margins and a valuation viewed as reasonable relative to growth are supporting the bullish case. Zacks article
Positive Sentiment: Netflix’s continued push into live sports—including an MLB “Field of Dreams” game—and the extension of its Seinfeld agreement could strengthen engagement, advertising opportunities and content retention. MLB live sports article
Neutral Sentiment: Institutional positioning is mixed: some large investors added shares while others reduced holdings. Analysts’ reported price targets remain above the current market level, but investors still must weigh valuation and slowing growth expectations.
Negative Sentiment: Netflix closed its Hollywood-based Night School gaming studio and plans to close Helsinki-based Moonloot. The closures may improve focus and reduce costs, but they also raise questions about the company’s gaming strategy and ability to expand beyond streaming. Los Angeles Times article
Negative Sentiment: Reported insider trading shows 30 Netflix open-market sales and no purchases over the past six months. While such sales may reflect compensation or diversification, the one-sided pattern can weigh on sentiment and contrasts with Ackman’s new bullish position. Quiver Quantitative article
Analyst Upgrades and Downgrades
A number of equities research analysts recently weighed in on the stock. Jefferies Financial Group cut their price objective on shares of Netflix from $128.00 to $110.00 and set a “buy” rating on the stock in a research note on Wednesday, June 10th. Oppenheimer set a $85.00 price objective on shares of Netflix and gave the company an “outperform” rating in a report on Friday, July 17th. Barclays dropped their target price on Netflix from $85.00 to $80.00 and set an “equal weight” rating on the stock in a report on Friday, July 17th. Sanford C. Bernstein set a $95.00 price target on Netflix and gave the company an “outperform” rating in a research report on Friday, July 17th. Finally, TD Cowen cut their price objective on Netflix from $112.00 to $100.00 and set a “buy” rating for the company in a report on Friday, July 17th. Four equities research analysts have rated the stock with a Strong Buy rating, thirty-four have assigned a Buy rating, sixteen have issued a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat.com, Netflix has a consensus rating of “Moderate Buy” and an average price target of $103.48.
View Our Latest Report on NFLX
Insider Buying and Selling at Netflix
In other Netflix news, insider David A. Hyman sold 5,723 shares of the company’s stock in a transaction on Tuesday, August 4th. The shares were sold at an average price of $72.85, for a total transaction of $416,920.55. Following the sale, the insider directly owned 316,100 shares of the company’s stock, valued at approximately $23,027,885. This represents a 1.78% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available through this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Gregory K. Peters sold 27,312 shares of the company’s stock in a transaction on Thursday, August 6th. The shares were sold at an average price of $73.54, for a total transaction of $2,008,524.48. Following the completion of the transaction, the chief executive officer owned 120,931 shares in the company, valued at approximately $8,893,265.74. This represents a 18.42% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 600,295 shares of company stock valued at $49,056,671 over the last 90 days. Company insiders own 1.24% of the company’s stock.
Netflix Stock Down 0.1%
NFLX stock opened at $78.16 on Friday. The firm has a market cap of $325.45 billion, a PE ratio of 24.60, a PEG ratio of 0.98 and a beta of 1.52. Netflix, Inc. has a 1 year low of $65.08 and a 1 year high of $126.71. The company has a fifty day simple moving average of $74.67 and a 200 day simple moving average of $84.54. The company has a current ratio of 1.14, a quick ratio of 1.14 and a debt-to-equity ratio of 0.39.
Netflix (NASDAQ:NFLX – Get Free Report) last issued its quarterly earnings results on Thursday, July 16th. The Internet television network reported $0.80 EPS for the quarter, topping the consensus estimate of $0.79 by $0.01. Netflix had a return on equity of 40.02% and a net margin of 28.22%.The company had revenue of $12.56 billion for the quarter, compared to the consensus estimate of $12.58 billion. During the same period in the previous year, the business posted $0.72 EPS. The company’s revenue for the quarter was up 13.4% on a year-over-year basis. Sell-side analysts anticipate that Netflix, Inc. will post 3.59 EPS for the current fiscal year.
Netflix Profile
(Free Report)
Netflix, Inc (NASDAQ: NFLX) is a global entertainment company that provides subscription-based streaming of films, television series, documentaries and other video content. Founded in 1997 by Reed Hastings and Marc Randolph and headquartered in Los Gatos, California, the company began as a DVD-by-mail rental service and introduced streaming video in 2007. Netflix later expanded into producing and distributing original programming, beginning notable original hits in the 2010s, and now operates a content production and distribution ecosystem alongside its licensing activity.
The company’s primary product is its on-demand streaming service, which can be accessed on a wide range of internet-connected devices and delivered through a suite of apps and web platforms.
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Fond Pershing Square se po čtyřech letech vrací do Netflixu, přestože při předchozím odchodu zaznamenal ztrátu 400 milionů USD. Ackman zároveň přidal nové pozice ve Visa, Mastercard, Alcon, Intercontinental Exchange a S&P Global.
Bill Ackman's investment firm Pershing Square has marked a return to the Netflix stock register four years after exiting a position with a $400 million loss.
Pershing Square previously held Netflix, the streaming company, briefly in 2022 before selling out at a loss.
The renewed bet on Netflix comes as Ackman's funds trail the wider market this year.
Ackman’s decision to re-enter Netflix signals a significant change in his outlook on the streaming industry.
It comes as Ackman's Pershing Square disclosed six new stock holdings. As well as the Netflix investment the fund added to its holdings with positions in Visa, Mastercard, eye care company Alcon, exchange operator Intercontinental Exchange and financial data provider S&P Global since the start of the second quarter.
Ackman expects strong earnings growth at the six companies, which he treats as the main driver of investment value over time.
The fund manager also unwound a major media investment elsewhere in the portfolio.
Ackman notably exited an estimated $1.5 billion position in Universal Music Group (AEX:UMG) after the company rejected his $65 billion takeover bid.
Visa and Mastercard, the payments networks, alongside S&P Global and Intercontinental Exchange, the exchange operator, all sit in sectors with high barriers to entry and steady, recurring revenue.
Alcon, the eye care company, rounds out a portfolio now weighted towards defensive, market-leading firms rather than turnaround or takeover bets.
Netflix ve 2. čtvrtletí zvýšil tržby na 12,6 miliardy USD, meziročně o 13 %, a výhled provozní marže pro rok 2026 zůstává na 31,5 %. Firma zároveň odkoupila rekordních 4,7 miliardy USD vlastních akcií.
Key Takeaways Netflix delivered $12.6B in Q2 revenues, up 13%, while 2026 margin guidance remains at 31.5%.Netflix generated $1.5B in Q2 free cash flow and repurchased a record $4.7B of stock.Advertising revenues are tracking toward 43B in 2026, while live sports and content extend into 2027.
Netflix (NFLX - Free Report) shares have plunged 20.9% year to date, a decline steep enough to test the patience of long-term holders. Shares of Netflix have underperformed the broader Zacks Consumer Discretionary sector's decline of 7.5%
Yet a close reading of the company's own second-quarter 2026 disclosures suggests the pullback has more to do with sentiment and rich starting valuation than with any breakdown in the underlying business.
Revenues, margins, cash generation and the forward content calendar all point in a steady, upward direction, which is why the more defensible near-term stance is to hold existing positions or wait for a better entry point rather than exit the name altogether
NFLX Underperforms Industry, Sector YTD
Image Source: Zacks Investment Research
Headwinds remain worth noting. Content amortization growth has pressured near-term margins, and competition for viewer attention from short-form video continues to intensify. Given this combination of accelerating ad monetization, a diversified and still-growing content and live-sports slate extending into 2027, and aggressive capital returns backed by strong free cash flow, the fundamental growth story remains largely intact even as the shares have underperformed year to date.
Fundamentals Still Support a Hold StanceThe first reason to stay invested is straightforward top-line durability. Netflix generated second-quarter revenues of $12.6 billion, up 13% year over year on a reported basis and 12% on an F/X-neutral basis, with double-digit growth recorded in every operating region.
For the full year, the company has narrowed its guidance to $51-$51.4 billion in revenues, implying 13-14% reported growth, alongside a maintained operating margin target of 31.5% for 2026 versus 29.5% in 2025. That margin trajectory implies operating income growth of more than 20% for the year, a rate that outpaces revenue growth and signals continued operating leverage rather than margin erosion.
Regional performance reinforces this picture. EMEA revenues surpassed the $4 billion quarterly mark for the first time, while LATAM and APAC each crossed $1.5 billion, with UCAN revenue growth of 10% reflecting only a partial-quarter impact from the latest U.S. price change.
The Zacks Consensus Estimate for 2026 earnings is pegged at $3.59 per share. This indicates a 41.9% increase from the previous year.
The second reason is cash generation and capital discipline. Free cash flow came in at $1.5 billion for the quarter, and management continues to guide toward approximately $12.5 billion for full-year 2026. That cash flow has funded an aggressive buyback program. Netflix repurchased $4.7 billion of stock in the second quarter alone, its largest quarterly repurchase on record, after its board authorized an additional $25 billion in April on top of remaining prior capacity. The company still had $27.1 billion of buyback authorization left at quarter-end, a cushion that can support the share price through periods of multiple compression even if near-term sentiment stays soft.
The third reason is diversified monetization. Advertising revenues are tracking toward roughly $3 billion for 2026, about double the prior year, with U.S. upfront negotiations described as being in advanced stages as of the July letter. Engagement also remains constructive, with first-half 2026 view hours up 2% year over year despite competition from the Winter Olympics and the World Cup, and non-English-language content again driving more than a third of total viewing. Newer formats, including video podcasts, cloud TV games and creator partnerships, are still small in absolute terms but are scaling quickly and add optionality beyond the core subscription and advertising streams. Technology investment is compounding these efforts: GenAI workflows were used across roughly 300 titles in 2026 for production tasks such as complex visual sequences, while AI-powered planning and reporting tools are being extended to programmatic ad buyers, steps management frames as groundwork for the next phase of advertising growth.
Content Pipeline Extends Into 2026 and 2027Netflix's forward slate underpins these targets. The company has an expanded NFL agreement covering a week-one game, a Thanksgiving Eve matchup, a Christmas Gameday broadcast and a contest in first-quarter 2027, alongside the Tyson Fury versus Anthony Joshua fight and two Major League Baseball events this year. On the entertainment side, upcoming titles include The Whisper Man, The Last House, the final season of Outer Banks, Ryan Murphy's Monster: The Lizzie Borden Story, and international originals inlcuding South Korea's The East Palace, Poland's The Doll, Mexico's Lovesick, and the UK's The Gentlemen S2. Netflix is also premiering an exclusive extended look at Grand Theft Auto VI in August ahead of its industry launch, and recently signed a global streaming licensing agreement with AMC for the entire Walking Dead universe, broadening the near-term catalog while 2027 slate items continue to be layered in through ongoing local-language production deals.
Valuation and Competitive LandscapeFrom a valuation standpoint, Netflix appears overvalued, trading at a forward 12-month price-to-sales ratio of 5.63X, notably higher than the Zacks Broadcast Radio and Television industry's 3.17X, and it carries a Value Score of D, signaling shares are pricier than industry peers relative to underlying sales growth trends.
NFLX’s Valuation
Image Source: Zacks Investment Research
Competition remains intense. Disney (DIS - Free Report) keeps expanding its streaming service alongside parks strength, Apple (AAPL - Free Report) funds original programming despite a smaller subscriber base, and Amazon (AMZN - Free Report) bundles Prime Video with its e-commerce ecosystem to retain viewers. Disney, Apple and Amazon all compete for the same premium content budgets and advertiser dollars Netflix is targeting. Even so, Netflix's global scale, ad-tier momentum and expanding live-sports rights give it a durable edge over rivals like Disney, Apple and Amazon that arguably justifies some premium, so investors may still prefer holding the stock or waiting for a better pullback entry point rather than chasing shares at current levels.
ConclusionWith revenue guidance intact, margin expansion on track, ads scaling toward $3 billion, and a content and live-sports calendar extending through 2027, Netflix's fundamentals remain sound despite the year-to-date decline. Investors already holding shares have reason to stay put, while those on the sidelines may find further weakness a more attractive entry point than chasing strength. NFLX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Netflix vzrostl ve čtvrtek o více než 4 % poté, co Bill Ackman prostřednictvím Pershing Square oznámil nový 4,9% podíl. Fond věří v dlouhodobý růst firmy.
Netflix NFLX stock rose more than 4% on Thursday after billionaire investor Bill Ackman's Pershing Square Capital Management disclosed a new stake in the streaming giant, marking a return to the company more than four years after exiting its previous investment at a loss.
In its second-quarter shareholder letter, Pershing Square revealed it had acquired a 4.9% portfolio stake in Netflix.
The hedge fund, known for running a concentrated portfolio of fewer than a dozen holdings, said it believes the streaming company is well-positioned for long-term growth despite the stock's sharp decline from last year's peak.
The renewed investment comes as Netflix continues expanding its advertising business and live sports offerings while investors reassess the company's valuation following a prolonged share-price correction.
Pershing Square said its investment thesis has changed significantly since it exited Netflix in early 2022 after losing more than $400 million on the position.
"When we first invested in early 2022, investors feared an escalating content arms race among a crowded field of streaming entrants," Bill Ackman and Pershing Square Chief Investment Officer Ryan Israel wrote in the shareholder letter.
The executives argued that those concerns have largely faded, adding that "Netflix has since effectively won the streaming wars."
They pointed to the company's dominant subscriber base, saying its scale has become self-reinforcing and allows Netflix to outspend rivals on content while converting roughly 90% of its earnings into free cash flow.
Pershing also said it expects Netflix "to compound revenue at a double-digit growth rate, with content costs growing more slowly than revenue, driving continued margin expansion," while describing the stock's valuation as "a substantial discount" and "highly attractive in terms of business quality and prospective earnings growth."
Pershing's renewed confidence comes as Netflix continues adding new revenue streams beyond its traditional subscription business.
The company has expanded into live sporting events to attract additional viewers while growing its lower-priced, ad-supported subscription tier.
According to the reports, Netflix expects its advertising business to generate approximately $3 billion in revenue this year, while its 2026 US Upfront advertising commitments have nearly doubled from a year earlier.
Pershing also argued that concerns over competition from short-form video platforms have proven overstated.
The firm believes Netflix has sufficient financial resources to absorb higher computing costs associated with artificial intelligence and expects AI to improve both content recommendations and advertising targeting over time.
Netflix shares remain well below their previous highs after concerns surrounding engagement, failed acquisition rumors, and the company's abandoned attempt to acquire Warner Bros. Discovery weighed on investor sentiment.
The stock has fallen roughly 42% from last year's peak and was trading at around 24 times earnings, well below its three-year average valuation multiple of 43.
Pershing said the broader market's focus on artificial intelligence infrastructure investments has created opportunities in other sectors.
Ackman and Israel wrote that the environment has enabled the firm to deploy nearly $5 billion since Pershing Square's initial public offering earlier this year.
It's been a little over five months since the global movie and streaming giant Netflix (NFLX -1.97%) walked away from an $82.7 billion bid to acquire Warner Bros. Discovery's film and studio assets, paving the way for its rival Paramount Skydance to buy the entire company.
Since then, Netflix's stock has come under pressure as investors rethink the company's growth prospects as it shifts out of its previous rapid expansion phase toward a more mature business model. But what might the next five years have in store for Netflix and its shareholders?
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Is buying growth better than slowing growth? Netflix's stock price initially surged after management decided to cede the fight for Warner Bros. to Paramount Skydance. Investors had been worried about the financial risks Netflix would be taking on if it managed to seal the deal -- specifically, the prospect of taking on billions in additional debt to finance the buyout and the challenges of combining two large and complex businesses into a cohesive whole.
However, with the benefit of hindsight, it's easy to see why management thought the megamerger was a good idea before a competing bid from Paramount made the price too steep to justify: Netflix is running out of organic growth, and that has been causing its stock to rapidly lose its premium valuation.
The company's second-quarter earnings highlight this troubling trend.
Revenue rose by just 13% year over year to $12.6 billion, a deceleration from the top-line growth rate of 16% that Netflix enjoyed in the corresponding quarter of 2025. More importantly, engagement growth is also soft, with viewing hours up by just 2% in the first half of the year. This suggests most of Netflix's revenue growth is now coming from squeezing more money out of existing users instead of attracting and engaging new ones -- a symptom of the heavy competition in the streaming space.
Netflix is becoming a mature business No company can expand at a breakneck pace forever. But the transition from being a growth business to a mature business doesn't necessarily have to be a train wreck, and Netflix has several key advantages that can help smooth the way. For starters, it enjoys immense size and brand recognition, which will help it generate substantial shareholder value, even as engagement growth begins to plateau.
Even small increases in pricing across over 325 million subscribers can translate to meaningful revenue and profit growth. And Netflix is still at the early stages of monetizing its most exciting strategy: advertising.
Image source: Getty Images.
Management expects to deliver $3 billion in total advertising revenue in 2026, which would be double the figure it reported last year. The fact that this business has been able to scale up so rapidly is evidence of the natural advantages provided by Netflix's scale. And this might only be the beginning: Analysts at the World Advertising Research Center project that Netflix's ad revenue will hit $8 billion by 2030 as it continues to improve its technology and expand its global advertiser base.
Investors also shouldn't overlook Netflix's international opportunities. While the company has already penetrated over half of American households, it has much more room to grow in regions like Asia, especially as it invests in localized, native language content. The company has already created over 200 originals in India, and its deep pockets and global experience will likely help it stand out from the local competition.
What will the next five years have in store? Netflix is a mature company. And because it is already so large, even huge opportunities like digital advertising and international expansion will only contribute modest growth to its top line. That said, shares trade at a reasonable forward price-to-earnings (P/E) multiple of 23, which is just slightly higher than the S&P 500's average forward P/E of 21. And if shares continue to decline, Netflix could soon become an attractive value pick for long-term investors.
Netflix klesl asi o 43 % z 52týdenního maxima a obchoduje se za zhruba 20násobek očekávaného zisku. Firma přesto letos čeká tržby 51,0 až 51,4 miliardy USD a provozní marži 31,5 %.
Netflix (NFLX -2.00%) trades at $72.39 as of this writing, down about 43% from its 52-week high of $126.71. Along the way down, something notable happened to the stock's price tag: Shares finally look reasonably priced. The stock now costs about 20 times the earnings analysts expect from the company over the coming year. At last year's high, the same forward estimate would have priced the stock in the mid-30s.
The rapid-growth premium, in short, is gone. The interesting question is what the stock is worth by 2029 if the business simply keeps doing what its own guidance describes. The arithmetic is worth walking through.
Image source: The Motley Fool.
The business behind the de-rated price Netflix's second-quarter results, reported in mid-July, show a company still growing at a double-digit pace -- just a slower one. Revenue rose 13% year over year to $12.6 billion, in line with the company's forecast. But the trajectory is what the market is watching: growth of 16.2% in the first quarter became 13.4% in the second, and management's third-quarter forecast implies about 12%. That's a clear deceleration.
For the full year, Netflix expects revenue of $51.0 billion to $51.4 billion, or 13% to 14% growth, along with an operating margin of 31.5%, up from 29.5% in 2025. That margin target implies operating income growth of more than 20% this year. Profits, in other words, are still compounding meaningfully faster than sales. Second-quarter operating income rose 11% year over year to $4.2 billion, and the company still expects about $12.5 billion of free cash flow for the year -- enough to support substantial share repurchases.
Two other pieces matter for the next three years. The first is advertising. Management projects the streaming service's ads revenue will roughly double in 2026 to approximately $3 billion. That's only about 6% of total revenue, but it's a fast-growing 6%, and it gives Netflix another growth lever beyond subscription price increases.
The second is share repurchases. Netflix bought back $4.7 billion of stock in the second quarter, its largest quarter ever, and it has $27.1 billion of authorization remaining.
The company's balance sheet drama has also cleared. Its agreement to buy Warner Bros. Discovery's streaming and studios businesses, including HBO Max, was terminated in February, and Netflix collected a $2.8 billion termination fee for its trouble.
The arithmetic to 2029 Now the forward math, piece by piece, with round numbers.
If revenue growth eases from about 13% this year to about 10% by 2029 (a continued glide, not a sharp break), revenue lands near $68 billion to $70 billion in 2029.
Margins should keep helping. Netflix has expanded its operating margin by about two percentage points a year recently. Assume that pace slows, and the margin settles around 35% by 2029. That puts operating income near $24 billion, up about 50% from this year's implied level.
Buybacks then do their part. Add a steadily shrinking share count, and earnings per share could plausibly reach about $5.00 to $5.50 in 2029, up from the roughly $3.50 analysts expect over the coming year.
The last variable is the multiple. Hold today's 20 times forward earnings, and those figures imply a stock price somewhere near $100 to $110 by 2029. Stretch the multiple range from 18 to 22 (pessimism on one end, a mild rerating on the other), and the band widens to about $90 to $120.
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From $72.39, the midpoint of that range works out to an annualized return of about 13%. Not spectacular, but comfortably ahead of what most investors should expect from the broader market. And it requires no heroics, only Netflix hitting the trajectory its own guidance already sketches.
Of course, the arithmetic cuts the other way if the deceleration doesn't stop. If revenue growth slides through 10% and keeps going, the margin story eventually stalls with it, and a market already refusing to pay a premium could mark the multiple down further. That's the scenario the current price is bracing for.
My own read is that Netflix by 2029 is probably a $90-to-$120 stock, and the outcome inside that range comes down to growth stabilizing in the double digits. That's a fair price today, not an obviously cheap one. I'm not buying yet, but a quarter or two of steadier revenue growth would probably change my answer.
Netflix uzavřel s AMC Global Media víceletou globální licenční dohodu údajně za 500 milionů USD na The Walking Dead Universe. Od roku 2027 získá spoluexkluzivní práva ke 371 epizodám včetně všech spin-offů.
Netflix is doubling down on one of television’s biggest franchises, signing a massive new licensing agreement worth a reported $500 million to bring The Walking Dead Universe to audiences around the world.
AMC Global Media announced Thursday that it has reached a multi-year global licensing agreement with Netflix that will give the streaming giant co-exclusive rights to the original “The Walking Dead” series and all six of its spin-offs. In total, the deal covers 371 episodes spanning the entire franchise.
Netflix has been the exclusive U.S. streaming home of The Walking Dead since 2011, helping introduce the survival drama to millions of viewers. Now, thanks to the new agreement, its availability extends to additional markets including the U.K., Italy, Australia, and New Zealand.
The deal is particularly notable because Netflix will not have exclusive rights. Instead, the company will share streaming access with AMC+, meaning it will end Netflix’s more than decade-long exclusive hold on the series.
The $500 million price tag ranks among the most expensive television licensing deals in recent years. (For comparison, HBO Max paid $425 million to bring “Friends” from Netflix to its platform in 2020.)
Additionally, the move comes as recent data suggests many Netflix subscribers don’t stick around for second seasons of newer shows, making established franchises with hundreds of episodes a safer bet for driving binge-watching and overall viewing hours.
Beginning in 2027, Netflix subscribers around the world will also gain access to the franchise’s entire slate of spin-offs, including “Fear the Walking Dead, “World Beyond Tales of the Walking Dead,” “Dead City,” “Daryl Dixon,” and “The Ones Who Live.”
The agreement also arrives as “Dead City” returns for its third season. Fans are also looking ahead to the final season of “Daryl Dixon,” scheduled to premiere in 2027.
The Walking Dead joins a growing list of popular shows Netflix has pursued to drive engagement. Over the years, it has spent billions securing streaming rights to series such as “The Office,” while earlier this year it also reached a deal to stream “Sesame Street.”
Meanwhile, the announcement provided a boost to AMC Networks’ financial outlook. The company unveiled the Netflix agreement alongside its quarterly earnings report on Thursday, using the deal to raise its forward guidance.
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Netflix sází na vybrané živé akce, které táhnou nové předplatitele; šest z jeho 10 největších dnů registrací za pět let přišlo právě díky nim. Letos mají živé přenosy tvořit asi 5 % výdajů na obsah a 1 % sledovanosti.
Key Takeaways Netflix uses selective live events to drive subscriber sign-ups, engagement and advertising growth. NFLX says six of its 10 biggest sign-up days in five years were driven by live events. Netflix uses live broadcasts to promote originals and expand content discovery across its platform. Netflix's (NFLX - Free Report) expanding investment in live programming is emerging as a key driver of its long-term subscriber growth strategy. Rather than pursuing an expensive portfolio of premium sports rights, the company has adopted a selective approach by adding live sports, entertainment specials and marquee events that complement its on-demand library. Recent initiatives, including the MLB Home Run Derby, the World Baseball Classic in Japan and other live entertainment events, reflect Netflix's efforts to attract new members while expanding engagement and advertising opportunities. Live programming is evolving into a strategic extension of Netflix's core streaming business rather than a standalone offering.
Early results suggest that live content is generating meaningful business value despite representing a small portion of Netflix's content investment. Six of the company's 10 largest new-member sign-up days over the past five years have been driven by live events. While live programming is expected to represent roughly 5% of content spending and only about 1% of viewing hours this year, it has been supporting subscriber acquisition, advertising demand and content discovery. Total viewing hours increased 2% year over year in the first half of 2026, adding roughly 1.5 billion viewing hours.
Netflix is also leveraging live events to strengthen its broader content ecosystem by using marquee broadcasts to promote original series and encourage viewers to discover additional programming. This integrated approach enhances returns on content investments by extending viewer engagement beyond live events while creating premium advertising inventory for marketers.
By focusing on high-impact live events that drive new-member acquisition, deepen engagement and expand advertising opportunities, Netflix is strengthening another lever for subscriber growth. As the company expands its live content portfolio in a disciplined manner, the strategy could support sustained subscriber growth while creating additional monetization opportunities.
How Netflix Stacks Up Against PeersCompared with Disney (DIS - Free Report) and Warner Bros. Discovery (WBD - Free Report) , Netflix's live content strategy is more selective and event-driven. Disney continues to rely on ESPN and premium sports rights to drive engagement, while Warner Bros. Discovery leverages TNT Sports and live programming across its media portfolio. In contrast, Netflix focuses on marquee live events that complement its on-demand library and support subscriber acquisition. As Disney expands its streaming bundle and Warner Bros. Discovery integrates live sports into Max, Netflix's disciplined approach could help sustain membership growth while enhancing advertising opportunities.
NFLX’s Price Performance, Valuation & EstimatesShares of Netflix have declined 22.8% year to date, underperforming both the Zacks Broadcast Radio and Television industry and the Zacks Consumer Discretionary sector’s fall of 20.9% and 9.6%, respectively.
NFLX’s YTD Share Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, Netflix appears overvalued, trading at a forward 12-month price-to-earnings ratio of 19.36X, higher than the sector’s 16.4X. NFLX carries a Value Score of D.
NFLX’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NFLX’s 2026 earnings is pegged at $3.59 per share, down by a penny over the past 30 days. This indicates a 41.9% increase from the previous year.
NFLX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Netflix za 12 měsíců klesl o 41 %, ale tržby dál rostou a provozní marže ve 2. čtvrtletí stoupla na 33 %. Firma zároveň zúžila výhled tržeb pro rok 2026.
Netflix (NFLX +1.73%), the streaming leader, has had quite an interesting year, to say the least.
Investors have watched the share price plummet some 41% over the past 12 months and 26% so far in 2026. The malaise has been punctuated by the failed bid to buy Warner Bros. Discovery (WBD -0.69%).
Last summer and fall, there was constant chatter that Netflix was the front-runner in the bidding war to acquire Warner Bros. Discovery (or rather, most but not all of its assets), but investors balked, thinking that Netflix was paying too much for assets that would be hard to integrate. There were also concerns that it would be saddled with debt, and that it would have to change its business model.
Then, when Paramount Skydance (PSKY -3.30%) swooped in with a large enough counter-bid to snatch Warner Bros. Discovery away from Netflix, some investors decried the loss of a potentially transformational purchase and asked, "OK, what's next?"
Image source: Getty Images.
Slowing revenue growth, rising margins Netflix has also dealt with declining revenue growth rates over the last few quarters. It grew 13% year over year in the second quarter, down from 16% in Q1 and 18% in Q4 2025.
Its guidance for Q3 calls for revenue of $13 billion, which would be 12% year-over-year growth. The company also narrowed its revenue forecast for 2026 to a range of $51 billion to $51.4 billion. The previous range was $50.7 billion to $51.7 billion.
On the other hand, viewership was up 2% in the first half of 2026, better than the 1.5% viewership growth rate in the first half of 2025.
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Further, its operating margin keeps rising. It was at 33% in Q2, up from 32% in Q1 and 24% in Q4 2025. The outlook calls for a 33% operating margin in Q3 and 31.5% for the year. That would be up from 29.5% in 2025.
The rising margins could have a lot to do with the growth of its higher-margin advertising sales. In 2026, Netflix expects to double its ad revenue to $3 billion.
It's time to buy I think the concerns are overblown. Netflix is still by far the streaming leader with the most hours of video watched and the most viewers.
Also, the company has lots of free cash flow. Netflix expects to have $12.5 billion in free cash flow in 2026, up from $10.1 billion in 2025. That provides solid ground on which to grow, possibly by getting more into streaming live TV events to boost engagement and ad revenue.
The slightly declining revenue growth rates and rising margins are signs of a maturing company -- and, in this case, one that remains the leader in its industry. The sell-off has brought down Netflix's valuation immensely. It is trading at just 21 times earnings, down from 63 times earnings a year ago. Its P/E ratio is at its lowest level in four years.
Wall Street is bullish on Netflix, with 68% of analysts rating it as a buy. Based on their median price target of $94.50, Netflix stock is expected to return about 37% over the next 12 months, so it looks like a strong buy right now.
Netflix po výsledcích za čtvrtletí oznámil rekordní zpětný odkup akcií za téměř 5 miliard USD a zvýšil autorizaci na 27 miliard USD. Management dál čeká růst tržeb o 13 % až 14 % a provozní marži 31,5 % za celý rok.
Netflix (NFLX +1.73%) shares fell 8% after its second-quarter report on July 16, yet the streaming giant is on pace for its most profitable year ever. The company spent nearly $5 billion on stock buybacks, its largest quarterly repurchase activity on record, and management reloaded its buyback authorization to $27 billion.
All of this comes at a time when investors appear disinterested, even as shares trade for less than 20 times earnings. The stock is down nearly 50% from last year's high, weighed down by a valuation rerating and concerns that user engagement is softening against rising competition from short-form video, podcasts, gaming, and other streamers.
Image source: The Motley Fool.
A maturing model Management argued on the earnings call last week that raw viewing hours don't tell the whole story, and its Q2 shareholder letter described engagement as healthy. Management continues to expect revenue growth of 13% to 14% and an operating margin of 31.5% for the full year. That's more than 1,000 basis points of margin expansion over the past three years.
The company's cash flow profile is strengthening as revenue growth outpaces content spending growth. Free cash flow is expected to grow by more than 30% this year to $12.5 billion, up from previous guidance of $11 billion, as margins continue to expand. Given the stock's performance of late, long-term Netflix shareholders are understandably left scratching their heads.
Management also noted that recent price increases in key markets, such as the U.S. and Mexico, have "gone well." The $8.99 ad-supported subscription plan provides an affordable entry point, and the company expects ad revenue to roughly double to $3 billion in 2026. That's still just 6% of revenue, but it carries higher incremental margins than the core subscription business, giving the margin story more room to run.
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The battle for attention Concerns surrounding user engagement were circulating heading into the report. On the earnings call, management pushed back on these concerns, arguing that engagement had improved slightly in the first half of the year. Still, the company's decision to move its detailed engagement report from a semi-annual to an annual release raises questions, especially after it stopped reporting subscriber metrics last year.
The rising competition for eyeballs and content quality are factors that have weighed on the stock. According to Nielsen, YouTube now captures roughly 13.5% of U.S. television viewing, well above Netflix's estimated 8% share. Netflix competes for viewing time, not only with other streamers, but with free alternatives like short-form video and podcasts.
More importantly, the consumer market for artificial intelligence (AI) is still in the early innings, creating further uncertainty around what the competitive landscape will look like in a few years.
That said, at 19 times forward earnings, the risk/reward has shifted. The stock hasn't been this attractively priced in a long time. While the engagement story is far from settled, a high-quality platform like Netflix is worth investing in at a below-market multiple.
Netflix uvádí, že více než třetina sledovanosti už připadá na obsah v jiných jazycích a v první polovině roku 2026 diváci zhlédli přes 97 miliard hodin. Globální lokální produkce má posilovat růst a udržet vyšší příjmy.
Key Takeaways Netflix's global content strategy is expanding audiences, engagement and long-term revenue drivers.More than one-third of viewing comes from non-English programming, aiding acquisition and retention.Members watched over 97 billion hours in first-half 2026 as Netflix expanded its global content pipeline. Netflix’s (NFLX - Free Report) global content strategy is making its growth more durable by expanding its international audience, strengthening engagement and diversifying its revenue and engagement drivers across global markets. The company continues to invest in local-language originals across major markets such as South Korea, India, Spain, South Africa and Mexico, with several regional productions evolving into global hits. Management noted that more than one-third of all viewing now comes from non-English programming, underscoring the increasing role of international content in driving subscriber growth and engagement.
This diverse content portfolio also strengthens multiple revenue drivers. Netflix estimates it has penetrated less than 45% of global households, captured only about 7% of its addressable revenue opportunity and accounts for roughly 5% of global TV viewing, highlighting significant room for international expansion. A broader mix of local and global programming supports this opportunity by improving subscriber acquisition and retention, enhancing pricing power and expanding the advertising business. Importantly, Netflix continues to grow content spending at a slower pace than revenue growth, reflecting disciplined investment as it scales its global library.
Supporting this strategy, Netflix's July 2026 "What We Watched: First Half of 2026" report disclosed that members watched more than 97 billion hours in the first half of the year. Looking ahead, the company continues to strengthen its worldwide content pipeline with new international productions such as Go Team! (Spain), Four Hands, Two Sonatas (South Korea), Operation Safed Sagar (India), Badly in Love Season 2 (Japan) and Nando Between Two Worlds (Brazil), alongside major franchises including Lupin Part 4, The Gentlemen Season 2, Avatar: The Last Airbender Season 2 and Peaky Blinders: The Immortal Man. This balanced mix of successful local originals and global franchises reinforces user engagement and supports more durable long-term revenue growth.
Netflix Faces Stiff Competition From Key RivalsDisney (DIS - Free Report) is challenging Netflix by expanding Disney+ internationally, increasing investment in local content and strengthening its technology. In contrast to Netflix's 'content-first' model, Disney combines globally recognized franchises and cross-platform IP with locally produced original programming. It leverages Disney parks, sports and merchandise marketing to deepen engagement while simultaneously expanding its operations beyond the United States.
Warner Bros. Discovery (WBD - Free Report) competes with Netflix by rapidly expanding HBO Max globally, investing in international launches, and combining its century-old film and television library with local-language original programming. WBD prioritizes curated, high-quality content over sheer volume and leverages iconic franchises and local hits to drive subscriber growth and strengthen global engagement.
NFLX’s Price Performance, Valuation & EstimatesShares of Netflix have declined 26.5% year to date, underperforming both the Zacks Broadcast Radio and Television industry and the Zacks Consumer Discretionary sector’s fall of 21.9% and 11.5%, respectively.
NFLX’s YTD Share Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, Netflix appears overvalued, trading at a forward 12-month price-to-earnings ratio of 18.43X, higher than the sector’s 16.12X. NFLX carries a Value Score of D.
NFLX’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NFLX’s 2026 earnings is pegged at $3.59 per share, down by a penny over the past 30 days. This indicates a 41.9% increase from the previous year.
Image Source: Zacks Investment Research
NFLX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Acumen Wealth Advisors v 1. čtvrtletí zvýšila podíl v Netflixu o 3 252,2 % a nakoupila dalších 24 489 akcií. Po transakci držela 25 242 akcií v hodnotě 2,427 mil. USD.
Acumen Wealth Advisors LLC lifted its position in Netflix, Inc. (NASDAQ:NFLX – Free Report) by 3,252.2% during the first quarter, according to its most recent 13F filing with the Securities and Exchange Commission (SEC). The firm owned 25,242 shares of the Internet television network’s stock after acquiring an additional 24,489 shares during the period. Acumen Wealth Advisors LLC’s holdings in Netflix were worth $2,427,000 at the end of the most recent quarter.
Several other hedge funds and other institutional investors have also bought and sold shares of the company. Brighton Jones LLC grew its position in shares of Netflix by 5.0% in the 4th quarter. Brighton Jones LLC now owns 5,390 shares of the Internet television network’s stock valued at $4,804,000 after purchasing an additional 257 shares during the period. Revolve Wealth Partners LLC raised its holdings in Netflix by 16.4% during the 4th quarter. Revolve Wealth Partners LLC now owns 1,023 shares of the Internet television network’s stock worth $912,000 after buying an additional 144 shares during the period. Sivia Capital Partners LLC lifted its stake in Netflix by 21.2% in the second quarter. Sivia Capital Partners LLC now owns 1,406 shares of the Internet television network’s stock valued at $1,883,000 after buying an additional 246 shares in the last quarter. Strategic Investment Advisors MI lifted its stake in Netflix by 18.9% in the second quarter. Strategic Investment Advisors MI now owns 774 shares of the Internet television network’s stock valued at $1,036,000 after buying an additional 123 shares in the last quarter. Finally, Schnieders Capital Management LLC. boosted its holdings in shares of Netflix by 12.1% in the second quarter. Schnieders Capital Management LLC. now owns 2,115 shares of the Internet television network’s stock valued at $2,832,000 after buying an additional 228 shares during the period. Institutional investors own 80.93% of the company’s stock.
Wall Street Analyst Weigh In A number of brokerages recently commented on NFLX. Stephens started coverage on shares of Netflix in a report on Friday. They set an “overweight” rating on the stock. Pivotal Research lowered their target price on Netflix from $96.00 to $70.00 and set a “hold” rating for the company in a report on Friday, July 17th. BMO Capital Markets downgraded Netflix from an “outperform” rating to a “market perform” rating in a research note on Monday. Barclays dropped their price target on Netflix from $85.00 to $80.00 and set an “equal weight” rating on the stock in a research note on Friday, July 17th. Finally, Moffett Nathanson reduced their price objective on Netflix from $120.00 to $115.00 and set a “buy” rating for the company in a research report on Wednesday, June 17th. Three investment analysts have rated the stock with a Strong Buy rating, thirty-three have assigned a Buy rating, seventeen have issued a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat, the stock currently has an average rating of “Moderate Buy” and an average target price of $104.21.
View Our Latest Research Report on Netflix
Key Netflix News Here are the key news stories impacting Netflix this week:
Positive Sentiment: Netflix delivered an earnings beat and continues to post double-digit revenue growth, while bulls argue the selloff has made the stock look inexpensive on earnings and cash flow. Netflix “Is Not a Broken Company” and Trades At Just 19x Earnings. Jim Cramer Says Start Buying Positive Sentiment: Several analysts and commentators say the post-earnings drop may have created a buying opportunity, citing Netflix’s ad business, live content ambitions, international growth, and strong free-cash-flow potential. Netflix (NFLX) Stock Still Looks Cheap On Cash Flow And Earnings Positive Sentiment: Phillip Securities upgraded Netflix from “moderate buy” to “strong-buy,” with one analyst saying engagement shows no signs of slowing and setting a higher price target than the current trading level. Netflix, Inc. (NFLX) is Attracting Investor Attention: Here is What You Should Know Neutral Sentiment: Wall Street coverage remains active and largely mixed-to-bullish, with some reports pointing to meaningful upside in consensus price targets even after the recent slide. Netflix Fell 45% Over 12 Months But This Ratings House Sees A Doubling Share Price Negative Sentiment: Investors are worried about softer revenue guidance, slowing growth momentum, and Netflix making viewership metrics harder to track, which raises questions about transparency and future monetization. Netflix (NFLX) Could Be 18% Undervalued After Soft Guidance Raised Fresh Growth Questions Negative Sentiment: Multiple articles described the stock’s recent action as a sharp post-earnings crash or “miserable stretch,” reflecting concern that the latest quarter did not convince investors that growth will reaccelerate soon. Netflix just made its slowdown harder to measure Insider Transactions at Netflix In other Netflix news, Director Bradford L. Smith sold 35,990 shares of the business’s stock in a transaction that occurred on Wednesday, June 17th. The stock was sold at an average price of $77.52, for a total transaction of $2,789,944.80. Following the transaction, the director owned 79,690 shares of the company’s stock, valued at $6,177,568.80. The trade was a 31.11% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Theodore A. Sarandos sold 27,312 shares of the company’s stock in a transaction that occurred on Tuesday, May 5th. The stock was sold at an average price of $87.97, for a total value of $2,402,636.64. Following the sale, the chief executive officer owned 284,804 shares in the company, valued at approximately $25,054,207.88. This represents a 8.75% decrease in their position. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last 90 days, insiders sold 899,839 shares of company stock valued at $80,141,661. 1.24% of the stock is owned by insiders.
Netflix Stock Up 1.6% Shares of NFLX stock opened at $68.67 on Wednesday. The firm’s fifty day moving average price is $79.42 and its two-hundred day moving average price is $86.49. The company has a current ratio of 1.14, a quick ratio of 1.41 and a debt-to-equity ratio of 0.39. Netflix, Inc. has a 1 year low of $65.08 and a 1 year high of $126.71. The firm has a market capitalization of $285.94 billion, a P/E ratio of 21.61, a PEG ratio of 0.85 and a beta of 1.52.
Netflix (NASDAQ:NFLX – Get Free Report) last announced its quarterly earnings data on Thursday, July 16th. The Internet television network reported $0.80 earnings per share for the quarter, beating the consensus estimate of $0.79 by $0.01. The company had revenue of $12.56 billion during the quarter, compared to analysts’ expectations of $12.58 billion. Netflix had a return on equity of 40.02% and a net margin of 28.22%.Netflix’s revenue for the quarter was up 13.4% compared to the same quarter last year. During the same quarter last year, the company earned $0.72 EPS. On average, equities analysts predict that Netflix, Inc. will post 3.6 EPS for the current fiscal year.
Netflix Profile (Free Report)
Netflix, Inc (NASDAQ: NFLX) is a global entertainment company that provides subscription-based streaming of films, television series, documentaries and other video content. Founded in 1997 by Reed Hastings and Marc Randolph and headquartered in Los Gatos, California, the company began as a DVD-by-mail rental service and introduced streaming video in 2007. Netflix later expanded into producing and distributing original programming, beginning notable original hits in the 2010s, and now operates a content production and distribution ecosystem alongside its licensing activity.
The company’s primary product is its on-demand streaming service, which can be accessed on a wide range of internet-connected devices and delivered through a suite of apps and web platforms.
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Netflix po výsledcích prudce oslabil, ale Jim Cramer ho označil za „nepoškozenou“ firmu a vidí v 19násobku očekávaného zisku vstupní příležitost. Doporučuje začít s malou pozicí a postupně přikupovat.
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Jim Cramer used his Tuesday, July 20, CNBC Mad Money segment to defend Netflix (NASDAQ:NFLX | NFLX Price Prediction) after a punishing post-earnings sell-off, telling viewers the streamer’s slide into the high-$60s makes the stock worthy of a closer look.
“This is not a broken company. It’s one of the best companies around with one of the best products, and the numbers are still better than most,” Cramer said, framing the stock’s 19x forward earnings multiple as an entry point patient investors have been waiting for.
Netflix shares are down 8.44% over the past week, 12.64% over the past month, and 44.1% over the past year, closing Tuesday at $68.67. That’s a sharp reset from levels near $95.55 at the start of April.
Netflix Beat Estimates, but Investors Still Sold the Stock Netflix’s Q2 2026 report on July 16 delivered EPS of $0.80 versus the $0.7883 estimate on revenue of $12.56 billion, up 13.37% year over year, with an operating margin of 33.4%. Growth was broad-based, with Latin America up 21%, Asia Pacific up 16%, EMEA up 14%, and North America up 10%. Netflix narrowly missed on Wall Street’s revenue expectations.
However, Netflix fell from $73.985 at the filing to $68.20 within an hour. Cramer conceded the quarter was a disappointment with a weakening content slate, but pushed back on the idea that the company is now fundamentally broken.
Netflix’s Advertising Revenue Could Double to $3 Billion Cramer shared Netflix’s bull case based on an uptick in advertising revenue. “Advertising revenues should roughly double to $3 billion this year, and management believes the gap between the economics of the ad-supported and the ad-free plans is narrowing,” he said, pointing to a gap now under 45%. On the earnings call, co-CEO Gregory Peters described that closing gap as “near-term, unrealized revenue growth” the company can harvest.
The Company Captures Only 5% of Global Television Viewing Then came the runway argument. “Penetration of its addressable broadband households captures only about 7% of the entertainment revenue available in those markets, and accounts for just about 5% of global television viewing, so there’s still plenty of room for growth,“ Cramer said. CFO Spencer Neumann noted Netflix is approaching 1 billion people in audience with household penetration under 45% of ~800 million addressable households.
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Netflix Repurchased a Record $4.7 Billion of Stock Additionally, Netflix repurchased $4.7 billion of stock in Q2, its largest buyback quarter ever, with roughly $27 billion in remaining authorization after April’s $25 billion refresh. Cramer characterized it as one of the largest corporate buyback programs in America, alongside investments across ads, games, live programming, podcasts, sports, and AI.
Cramer Says Buy a Small Position and Add “Pyramid Style” Cramer advocated for interested investors to start a small position and scale up over time. “I’d put a small position here and then gradually add on to weakness in pyramid style, because I wouldn’t be surprised if the weakness sticks,” he said.
Polymarket’s active weekly market assigns roughly 81% probability that NFLX closes the week of July 20-24 in the $60-$70 range, and the July monthly market puts the highest conviction at $65 with 0.405 probability.
Reddit sentiment mirrors the split Cramer is trying to bridge. Aggregate sentiment scores dropped to 24 on Monday afternoon, while a widely upvoted r/stocks thread titled “Netflix beat earnings, did its biggest buyback and then restricted access to its engagement data and fell 12% through two days” captured the frustration. Wall Street’s average analyst price target sits at $97.91 with 37 Buy and 13 Hold ratings, which represents significant upside from the stock’s current price of $68.67.
What To Watch Cramer believes Netflix’s sell-off has created an attractive entry point, but he cautioned that the stock could remain weak in the near term. His strategy is to start with a small position and gradually buy more if shares continue to fall.
The bull case now depends on Netflix doubling advertising revenue to $3 billion, restoring engagement growth, and meeting its Q3 guidance. If the company delivers, its global growth runway, record share repurchases, and 19x forward earnings multiple could make the current decline a long-term buying opportunity.
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Spolugenerální ředitel Netflixu Ted Sarandos řekl, že firma je „především stavitel, ne kupující“, a velké akvizice mají velmi vysokou laťku. To tlumí spekulace o brzkém převzetí.
Netflix (NFLX +0.53%) investors were disappointed with the company's most recent earnings results. Although the streaming giant continues to grow at a decent pace, it clearly isn't enough to win over growth investors, especially with it projecting its growth rate to decline to 12% for the current quarter (down from 13%).
One opportunity for Netflix to reignite its growth could be via an acquisition. The streaming company failed to acquire assets from Warner Bros. Discovery earlier this year, but Netflix's name continues to pop up in rumors. Investors may be eagerly anticipating news of a deal, in the hopes that it can pave the next wave of growth for the business. But co-CEO Ted Sarandos appeared to have poured cold water on that, stating on the company's earnings call that "we're primarily builders, not buyers."
Image source: Getty Images.
Why Netflix might not go the M&A route Sarandos made it clear on the company's recent conference call that while Netflix may not necessarily be averse to pursuing mergers & acquisitions (M&A), it would have to make a lot of sense for the business to consider one: "Our track record is clear that we have a very high bar to do any big M&A." CFO Spence Neumann also said, "we invest in the business both organically and opportunistically through M&A."
The key word there is opportunistically. When it pursued Warner Bros., Netflix had a great opportunity to acquire top assets and content, including HBO. And it pursued the deal aggressively until it no longer made sense to do so, as the valuation climbed amid a bidding war with Paramount Skydance.
While an acquisition could certainly help Netflix's business grow, management's focus on building rather than simply buying reflects what the company has done over the years. It has reinvested in its own growth, building its content and varied offerings rather than relying on acquisitions. It has yielded strong results as the business has grown tremendously over the years, and may continue to do so for the foreseeable future.
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0.36
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67.96
Is Netflix stock a buy? This year, Netflix's stock has declined by around 30%, as investors have appeared to have lost confidence in the company's path forward. While the market initially breathed a sigh of relief when Netflix walked away from the Warner Bros. deal earlier this year, the rally was short-lived, as concerns about what the company would do with co-founder Reed Hastings leaving the company began to weigh on the stock.
Uncertainty can significantly reduce a stock's value and also create attractive buying opportunities along the way. With Netflix trading near its 52-week low, it may be one of the best growth stocks for long-term investors to buy right now.
David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Netflix and Warner Bros. Discovery. The Motley Fool has a disclosure policy.
Shares of Netflix (NFLX 1.96%) recently closed at approximely $69, putting the streaming giant down 26% in 2026. The slide is part of a longer and more painful 48% decline over the past year or so. Netflix has generated life-changing returns for investors, so it has a strong reputation on Wall Street and hasn't fallen this far very often in the past decade.
But catching falling knives can be a dangerous game. What seems like the ultimate buying opportunity can easily punish overeager buyers. Here's what to make of the company after its latest plunge following its second-quarter earnings report release last week.
Image source: The Motley Fool.
Wall Street is sounding the alarm on slowing growth The market saw Netflix as a fast-growing darling for years. However, those days might be over. Netflix's revenue growth is suddenly slowing. Revenue grew by 17.6% in the fourth quarter of 2025, followed by 16.2% in the first quarter of 2026, and 13.4% in the second quarter. Making matters worse, management guided for only 11.7% growth in the current quarter, yet another deceleration. Wall Street tends to emphasize quarterly performance, which is working against Netflix at the moment, to be sure.
That's not always healthy, especially for long-term investors. That said, Netflix's slowing growth is definitely becoming a trend. It's worth considering the competitive landscape Netflix must contend with, which includes video games and social media, not just other streaming services. Unfortunately, it's not yet clear whether this is a blip for Netflix or if the business has peaked. Making that distinction will be even harder due to Netflix's decision to offer less transparency into subscriber and viewership data.
Here's why the selling might be overdone Multiple things can be true. Netflix absolutely deserves a lower valuation if its growth is stalling. At the same time, the market might be taking things too far. Even as parts of the business mature, Netflix could still have a very long runway to monetize its users. The company has delved into live sports over the past few years and is monetizing price-sensitive subscribers through ad-supported memberships.
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It's also worth mentioning that Netflix hasn't had very many blockbuster hits recently. That's not ideal, but the next Squid Game or KPop Demon Hunters sensation could suddenly reignite growth at any given moment.
In the meantime, the stock has fallen to just 19 times 2026 earnings estimates. Analysts still see Netflix growing earnings by an average of 21% to 22% annually over the next three to five years. Buying Netflix here is probably a home run if the company grows even close to that. Even assuming annualized growth comes in closer to 10%-12%, the stock could still deliver solid long-term returns from its current price point.
Is this the ultimate buying opportunity? Perhaps not; the stock could easily go lower. But it's easy to like Netflix stock here.
TV specialist Netflix (NFLX 1.99%) reported its second-quarter results on Thursday, and the report itself was uneventful. Revenue rose 13% year over year to $12.6 billion, matching management's forecast, and operating margin came in slightly ahead of plan.
Shares still fell about 7% on Friday, to $68.95 -- within a few dollars of their 52-week low.
The drop extends a miserable stretch. Netflix stock has lost more than 40% of its value over the past year, and it's down about 46% from its 52-week high of $126.71.
The sell-off has also produced a valuation that would have seemed unthinkable a year ago. The streaming giant trades at about 22 times earnings.
So, is the beaten-down growth stock finally a bargain?
Image source: Netflix.
A solid quarter by almost every measure There wasn't much to criticize in the report. Second-quarter revenue growth was driven primarily by membership growth, pricing, and increased ad revenue, and the company delivered double-digit gains in every region. Operating income rose 11% year over year to $4.2 billion, though the company's operating margin of 33.4% narrowed slightly from 34.1% in the second quarter of 2025. And earnings per share climbed 11% year over year to $0.80.
The full-year outlook is intact, too. Management narrowed its 2026 revenue forecast to a range of $51.0 billion to $51.4 billion, representing 13% to 14% growth, and it kept its operating margin target of 31.5%, up from 29.5% in 2025.
That forecast implies operating income growth of more than 20% this year. Netflix also still expects a rough doubling of its advertising revenue in 2026, to about $3 billion.
And the company is notably returning cash to shareholders at a record pace. Netflix repurchased $4.7 billion of its stock in the second quarter (its largest quarter of buybacks ever), and it still has $27.1 billion of repurchase capacity after its board added $25 billion to the program in April.
Clearly, the business itself is doing fine.
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67.58
The problem is the trend The problem is Netflix's growth trajectory. In the fourth quarter of 2025, revenue grew 17.6% year over year. Growth slowed to 16.2% in the first quarter of this year, then to 13.4% in the second. And management's third-quarter forecast calls for growth of about 12%.
Each step down is small. But that's three straight quarters of deceleration, with no floor yet in sight -- and some of it, I suspect, is simply the arithmetic of size catching up with the company.
Investors paid a premium for Netflix stock for years because its growth rate kept defying its size. As the growth rate has come down, the market has been repricing the stock from a premium growth story to something closer to a maturing one.
There is a caveat to the 22-times-earnings figure, however. Netflix's trailing profits include a one-time $2.8 billion termination fee the company collected in the first quarter after its deal for Warner Bros. Discovery's studio assets fell apart, and that windfall flatters the multiple.
Shares trade at about 20 times forward earnings. For a company forecasting operating income growth of more than 20% this year, that's arguably a fair price -- maybe even a modest one. But a multiple like this only stays fair if growth stabilizes somewhere near management's forecast. Valuations built on decelerating growth can keep compressing.
Of course, there are also reasons to wonder whether it stabilizes. Members watched more than 97 billion hours on the service in the first half of 2026, up 2% year over year. That's healthy engagement, but pricing is still one of the main drivers of revenue growth these days. The company also describes the entertainment industry as "dynamic and competitive," and it's fighting for viewing time against deep-pocketed rivals.
So, with shares a few dollars off their low and the froth mostly gone, is it finally time to buy? Not for me. The valuation is the most reasonable it has been in years, but the one thing that would make me comfortable paying even 20 times forward earnings (evidence that the growth step-down is leveling off) isn't in the numbers yet. After all, management's own forecast says the slowdown continues at least through the third quarter.
I'll keep watching for that floor. If revenue growth stabilizes in the low double digits while the operating margin keeps expanding, today's price could look cheap in hindsight. But until the trend turns, I'm staying on the sidelines.
Phillip Securities zvýšila doporučení pro Netflix z „accumulate“ na „buy“ a ponechala cílovou cenu 110 USD. Akcie jsou po pátečním propadu o 7 % za poslední rok níže o 46 %.
After a year of poorly received financial updates, Netflix (NFLX 3.13%) was bound to catch a break eventually. The premium streaming pioneer saw its shares tumble 7% on Friday after following up mixed financial results with uninspiring guidance, with the stock down 46% over the past year, but at least one Wall Street pro sees the markdown as a buying opportunity.
Helena Wang at Phillip Securities upgraded the beleaguered stock over the weekend. The move comes after at least 14 analysts slashed their price targets on Friday and another chimed in with a ratings downgrade. The move is timely for a stock that has shed nearly half of its value since hitting an all-time high last summer. Let's take a closer look.
Image source: Getty Images.
Success is relative Wang's move is notable for two reasons, after a flurry of pessimistic Wall Street notes heading into the weekend. Wang's is the lone upgrade so far, bumping her firm's opinion from "accumulate" to "buy." The Philip Securities analyst is also sticking to her earlier price target of $110.
With Netflix stock now sliding following its past five quarterly updates since peaking in June of last year, Wang's upgrade offers a refreshing break from the chart's reality. Netflix is clearly out of favor, despite its ongoing market dominance -- no one else comes to Netflix's paying audience of more than 300 million homes worldwide. This upgrade won't turn momentum around overnight, but it still offers encouragement to investors after a brutal year for the industry trailblazer.
Wang's decision to stick to her earlier target of $110 may not have seemed like much a few months ago, when the shares were higher, but now her unchanged price goal translates into near-term upside of 60% from Friday's close.
The analyst points out that membership trends remain positive and that members aren't flinching at the steady diet of rising subscription rates. Newer streaming services are just starting to turn profitable, but Netflix has consistently been in the black since adding a streaming option to its original disc-based platform almost 20 years ago.
Wang believes that engagement remains strong at Netflix and that profitability can accelerate as it expands its ad-supported monetization. The latter contrasts with analysts who were worried about Netflix's admission during last week's earnings call that it's exploring free ad-supported tiers in some countries outside the U.S. market.
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66.79
Field of streams Philip Securities isn't one of the largest firms following Netflix, and the bullish read of the report has been an exception to the rule. However, the upgrade over the weekend is a valuation call in light of the stock's recent markdown.
Netflix is cheap, historically speaking. It kicks off this week at just 19 times this year's projected earnings. Analysts may whittle those profit targets lower in the coming days, but you rarely find Netflix at a forward earnings multiple in the teens.
Analysts were already souring on Netflix even before the numbers became official late last week. A couple of Wall Street pros were putting out cautious notes in the days leading up to the big reveal, not an ideal situation for a stock that was already sorely lagging the market.
There are some near-term concerns. Its revenue guidance for the current quarter -- just shy of 12% year-over-year growth -- would be its weakest showing in three years. With Netflix out of favor, it may feel pressured to strike a dilutive buyout deal with a smaller rival. The stock has to practically double from today's price to return to the all-time high it reached 13 months ago, but there's still time for a Hollywood ending for Netflix.
Mark Mahaney z Evercore ISI si myslí, že „sentiment na Netflixu je nejslabší za poslední čtyři roky“. Řekl to v komentáři ke zveřejněným výsledkům této společnosti s tím, že se čekalo zklamání, a to se také dostavilo. Dobrým signálem také není to, když nějaká firma omezuje dostupnost informací, a to dělá Netflix, když nepodává tolik čísel ohledně vývoje sledovanosti.
Mahaney si myslí, že Netflixu sílí konkurence, jednak ze strany jiných streamovacích platforem a také ze strany rostoucí popularity krátkých videí. Dochází tak k pokračujícímu tlaku na pokles ARPU, tedy průměrného příjmu ze zákazníka, a tlaku na marže pramenícímu z intenzivnější konkurence. Netlix na druhou stranu dokazuje, že je schopný nabízet mimořádně zajímavý obsah a analytik jej a jeho akcii stále považuje za velmi kvalitní. S tím, že obrat v sentimentu a fundamentu ale zřejmě přijde až příští rok.
Mohl by Netflix udělat pro růst akcie „něco dramatičtějšího“? Na tuto otázku analytik odpověděl, že svým způsobem tak činí větším zaměřením na živé přenosy sportovních událostí. A zopakoval, že „v následujících 3 – 6 měsících bude akcie pod tlakem, ale má nastartováno na skok v roce 2027.“ Rich Greenfield z Lightshed Partners na CNBC řekl, že investoři u Netflixu začali předpokládat, že jako společnost už nebude dál růst. „Zpochybňují jeho růstový potenciál… Už dva lidé mi psali, že Netflix je mediální společností starého typu.“
Podle tohoto experta se situace může změnit jen časem tím, že Netflix zase dokáže růst. Investoři ale podle něj momentálně trpělivost nemají, ačkoliv firma tvrdí, že je stále v rané fázi svého rozvoje. Greenfield si přitom myslí, že bude klesat počet konkurentů kvůli různým fúzím, ale „nic z toho nyní nemá velký význam“. I on se však domnívá, že omezení informací není pozitivním krokem, „investoři si pak myslí, že společnost něco skrývá.“
Ross Gerber z Gerber Kawasaki Wealth and Investment Management na Bloombergu řekl, že Netflix udělal velký pokrok v oblasti sportu, ale zřejmě tu nechce dál masivně expandovat. K tomu dodal: „Streamovací byznys nyní dosáhl určitého maxima, je tu dost platforem, hodně obsahu, hodně konkurence. Není to chyba Netflixu, ale konkurence je silná… Dobrou nabídku má třeba HBO.“ Příležitostí pro Netflix by mohly být jednak hry a také distribuce obsahu do kin. To by mohlo generovat „miliardy dolarů ročně“, nikdo by přitom podle něj neměl problém s tím, že na samotnou platformu by se filmy dostaly později.
Gerber podle svých slov nedávno akcie nakoupil, protože se domnívá, že management Netflixu je velmi dobrý a „jen se musí dostat přes současné náročné období“. Má dostatek kapitálu, aby expandoval a „budeme ho dál sledovat my i naše děti… Odhadujeme jeho hodnotu výrazně výš, než je současná cena akcie.“ Minulost také podle Gerbera ukazuje, že firma se s problémy dokázala vždy vypořádat.
Netflix minulý týden klesl kvůli obavám, že vedení je vůči investorům méně transparentní. Firma od roku 2027 sníží zveřejňování údajů o sledovanosti ze dvakrát ročně na jednou za rok.
Shares of Netflix (NFLX 7.26%) sank last week on concerns that the streaming giant's leadership team was becoming less transparent with investors.
Image source: The Motley Fool.
Q2 results weren't the issue Netflix's revenue rose 13% year over year to $12.6 billion in the second quarter, fueled by gains in membership and advertising sales, along with streaming plan price increases.
Management noted that the video platform's view hours increased 2% in the first half of 2026 compared to 1.5% in 2025, despite the draw of the Winter Olympics and the World Cup offered by other TV and streaming networks.
All told, Netflix's operating income and earnings per share climbed 11% to $4.2 billion and $0.80, respectively.
Today's Change
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Current Price
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68.95
Declining transparency is disconcerting to investors Netflix narrowed its full-year revenue outlook to $51 billion to $51.4 billion, signifying growth of 13% to 14%. This guidance includes a forecast for ad revenue to double to $3 billion.
The company also expects operating margin to rise to 31.5% from 29.5% in 2025. Operating income, in turn, is projected to rise by more than 20%.
Importantly, Netflix said member engagement remains "healthy," driven by the success of popular original series such as I Will Find You and Swapped.
Yet investors were perplexed by management's decision to reduce the frequency of its closely followed "What We Watched" reports from twice a year to once a year, beginning in 2027.
If engagement trends are strong, why stop reporting viewership data?
Netflix says it wants to focus investors' attention on revenue growth, improving profitability, and free cash flow generation.
But experienced investors know that when a company stops sharing key data, it's usually because its performance in those metrics is weakening.
Netflix po výsledcích za 2. čtvrtletí klesl v poobchodní fázi o 8,2 % kvůli slabému výhledu na 3. čtvrtletí. Tržby mu rostou hlavně díky zvyšování cen.
Netflix (NFLX 7.26%) was down 8.2% in after-hours trading on July 16 at 5:53 PM EDT -- falling to $68.23 per share as investors digested its second-quarter 2026 earnings and weak third-quarter guidance. The problem is abundantly clear -- most of Netflix's revenue growth is coming from price increases.
Netflix's third price increase in less than three years marked a 12.5% jump in U.S. ad-supported monthly pricing, an 11.1% boost in U.S. standard monthly pricing, and an 8% increase in U.S. premium monthly pricing. In its latest quarter, Netflix reported a 13.4% year-over-year increase in revenue and is guiding for a 11.7% year-over-year increase in third-quarter revenue. Which sounds good on paper, until you factor in the glaring reality that price increases are the majority of revenue growth.
Here's what the results mean for investors, how they help paint the picture of why Netflix pursued major acquisitions, and if the growth stock is a buy now.
Image source: Netflix.
Competition for capturing user screen time is intensifying In February, Netflix declined to raise its offer to buy Warner Bros. Discovery, losing the bid to Paramount Skydance. Netflix was also in the hunt to buy Roku before being outbid by Fox Corp. in June.
The moves were somewhat alarming, given Netflix's history of organic growth through licensing and producing its own content. But investors have been concerned that Netflix's viewer engagement is under pressure from a slew of competitors in traditional media, streaming services, gaming, and user-generated content on platforms like Alphabet-owned YouTube.
At its core, Netflix's business model is to have subscription revenue exceed content costs. The more subscription revenue, the more demand for content. And as its global subscriber base has grown and Netflix has aggressively raised prices, there's more pressure for it to produce high-quality, engaging content.
In its July 16 shareholder letter, Netflix emphasized the importance of content quality:
We've used "engagement" as a shorthand for the value we deliver members. But, as we've developed an increasingly sophisticated understanding of how consumers ascribe value to our service, we know not all hours are equal. Time spent is just one aspect of strong engagement -- quality and variety also matter. The key is to improve across all of those dimensions: quality, variety, and quantity.
In practice, Netflix's definition of quality seems to revolve around proven content, such as Warner Bros. Discovery's intellectual property, including franchises like the DC and Harry Potter universes, Game of Thrones, Looney Tunes, and more. Proven content also includes Netflix's push into sports through the latest MLB Home Run Derby on July 13 and marquee NFL games like opening week, Thanksgiving Eve, Christmas Day, and week 18.
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Two sides to the Netflix narrative The glass-half-empty view of Netflix is that the company is desperately trying to buy content at premium prices to keep subscribers engaged and justify price increases. And that Netflix could eventually resemble a modern-day network with an emphasis on live-streamed events rather than pre-produced shows and movies. Netflix's quarter after quarter of slowing growth and dependence on price increases is fueling that narrative, which is why the stock is tanking.
However, the glass-half-full view on Netflix is that the company is simply bigger than it used to be and has the deep pockets to branch into new markets rather than relying heavily on its own content. To its credit, Netflix isn't willing to pay any price for content, as evidenced by its willingness to be outbid by much smaller companies in Paramount-Skydance and Fox. And Netflix has collected a sizable consolation prize in the process through its $2.8 billion termination fee from Warner Bros. Discovery.
Netflix's latest results are disappointing, and it was a mistake in hindsight to raise prices so much in just a few years. But the stock's decline reflects that pessimism -- with Netflix sporting its lowest valuation in years -- trading at just 19.1 times 2026 full-year earnings estimates as of its after-hours price at the time of this writing.
Netflix is no stranger to taking risks Netflix has always been a risk-taking company, from disrupting Blockbuster through mail-order DVDs to pioneering the modern streaming platform to producing award-winning live-action and animated series and movies. Each evolution has been riddled with bumps along the way and periods of investor loss of confidence. And right now, Netflix is enduring another such period as investors question the price it is willing to pay for quality entertainment and if it's making the right choices with sports and pushing into daytime and mobile device viewing.
So while it's understandable if some investors want to wait for the dust to settle and for Netflix to regain its footing, folks who are confident in Netflix's long-term strategy are getting an impeccable opportunity to buy the streaming service stock at a dirt-cheap price.
Netflix ve 2. čtvrtletí zvýšil tržby o 13 % meziročně na 12,6 miliardy USD, ale výhled naznačil další zpomalení růstu. Akcie po výsledcích v after-hours klesly asi o 9 %.
On July 18, 2016 (about ten years ago to the day), Netflix (NFLX 6.90%) shares closed at a split-adjusted $9.88. A $10,000 investment at that price would have bought about 1,010 shares, and with the stock at about $68 as of this writing, that stake would be worth about $68,500 today. That works out to a compound annual return of about 21%. The same $10,000 in the S&P 500 (^GSPC 1.01%) would have grown to roughly $35,000, before dividends.
That return wasn't earned comfortably, though. Holding meant sitting through some ugly weeks, including that very one: the day after Netflix's second-quarter 2016 report showed subscriber growth coming in well below the company's own forecast, shares sank 13%.
Anyone who bought into that plunge did even better, turning $10,000 into nearly $79,000.
And just a few days ago (almost exactly ten years later), Netflix fell hard after a second-quarter report once again. Shares dropped about 9% in after-hours trading as the streaming giant's forecast pointed to slower growth ahead.
The harder call, I think, is whether Netflix can keep compounding from here. Its latest report offers some clues.
Image source: Netflix.
Slowing growth Today's Netflix would be nearly unrecognizable to a 2016 shareholder. The company now generates more revenue in a single quarter ($12.6 billion in Q2) than the $8.8 billion it produced in all of 2016.
The second quarter itself was solid. Revenue rose 13% year over year, in line with management's guidance, with double-digit growth in every region. Earnings per share rose 11% year over year to $0.80. And Netflix's operating margin was 33.4%, down slightly from 34.1% in the year-ago quarter because the company's content amortization is growing faster in the first half of the year. For the full year, management still expects an operating margin of 31.5%, up from 29.5% in 2025.
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Also worth noting: Engagement looks healthy. Members watched more than 97 billion hours of content in the first half of 2026, the company's highest half-year total to date.
The problem is the trajectory. Netflix's year-over-year revenue growth rate has decelerated every quarter this year, from 17.6% in the fourth quarter of 2025 to 16.2% in Q1, 13.4% in Q2, and a forecast of just 11.7% for Q3. Management also narrowed its full-year revenue outlook to $51.0 billion to $51.4 billion, representing 13% to 14% growth.
Growth like that is hardly a crisis. But the hypergrowth that powered the stock's 21% annualized return over the past decade is downshifting.
The case for the next decade Netflix isn't out of growth levers, though.
The most important is advertising. Management said it remains on track to roughly double its advertising revenue this year, to approximately $3 billion -- about 6% of expected 2026 revenue. The company also said its U.S. upfront negotiations are in advanced stages, helped by strong advertiser interest in its live events lineup.
Live programming may be Netflix's most efficient way to win new members. The company expects live events to account for just over 5% of its content spend this year but only about 1% of viewing hours. Yet live programming has accounted for six of its top 10 new-member sign-up days over the past five years. An expanded NFL agreement, including a week-one game this quarter and games on Thanksgiving Eve and Christmas, builds on that approach.
And shareholders are getting paid along the way. Netflix repurchased $4.7 billion of its own stock in Q2, its largest quarter of share repurchases ever, and it still has $27.1 billion left on its repurchase authorizations.
Then there's the valuation. After Thursday's after-hours drop, shares trade at about 21 times forward earnings and sit about 47% below their 52-week high of $127.75. For years, the problem with Netflix stock was a valuation that demanded hypergrowth. Today's price asks for much less.
So, would I put $10,000 into Netflix stock today? Not yet.
A multiple of about 21 times forward earnings is arguably fair for a company growing revenue 13% to 14% with an expanding operating margin. But the growth rate is still stepping down quarter by quarter, and I'd like to see where it settles before buying. Of course, if the deceleration levels off, or if the advertising business scales faster than expected, I could change my mind.
The past decade turned $10,000 into about $68,500. The next one starts from a much bigger base, with a slower engine. So investors should keep their expectations in check.
Netflix klesl před otevřením trhu o 9,2 % po dalším slabším výhledu zisku na akcii a tržeb, které znovu zaostaly za odhady. Trh tak dál pochybuje o tempu růstu.
A drone view shows the Netflix logo on one of the company's buildings in the Hollywood neighborhood in Los Angeles, California, U.S., January 20, 2026. REUTERS/Daniel Cole Purchase Licensing Rights, opens new tab
July 17 (Reuters) - Netflix's (NFLX.O), opens new tab shares tumbled 9.2% before the bell on Friday following another weaker-than-expected earnings forecast from the streaming major, deepening doubts about its ability to sustain growth momentum.
While the company has gone beyond its traditional subscription-driven model, relying on advertising, live content and price hikes to boost revenue per user, it has been locked in a battle for user attention with traditional media such as Walt Disney (DIS.N), opens new tab and social media such as YouTube. The stock is down more than 44% since hitting an all-time high in June 2025.
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"The story lacks excitement," said Jeffrey Wlodarczak, analyst at Pivotal Research Group.
Subscriber growth remains central to Netflix's business, he said, adding that younger audiences are increasingly gravitating toward free social media platforms over long-form content.
"We believe this will result in slower subscriber growth and attempts by the company to offset this via more aggressive price increases and investment in content."
The company forecast quarterly earnings per share and revenue below analyst estimates for a second quarter in a row, on Thursday, with at least 11 analysts lowering their price targets.
The streaming giant will also cut its twice-yearly release of a viewing-hours report to once a year starting in January 2027. It stopped publishing quarterly subscriber numbers in 2025.
The first half of 2026 did little to ease bearish concerns, and the second half's content slate is weaker compared to a year ago, fueling the bear case, according to Jefferies analysts.
Netflix's shares were trading at 19.92 times 12-month forward profit estimates, compared with 13.54 for Walt Disney and Comcast's (CMCSA.O), opens new tab 6.57.
Reporting by Joel Jose in Bengaluru; Editing by Janane Venkatraman
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Netflix has an engagement problem. So it's going to stop talking about it as much.
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Netflix co-CEO Ted Sarandos is walking away from the company's practice of releasing viewer data twice a year. Kevin Dietsch/Getty Images Wall Street worries that Netflix has a problem with engagement — an issue you can see in the audience numbers the streaming giant periodically releases.
No problem, says Netflix: It will deal with that problem by … releasing audience numbers less often.
Netflix says it is going to stop putting out its "What We Watched" report — a voluminous data dump that details viewership for thousands of individual shows and movies — twice a year, as it has been doing since December 2023, and just did Thursday.
Instead, it is going to provide the information once a year.
Why? The company is relatively candid about this in the investor letter it released Thursday afternoon: It wants Wall Street to stop focusing on the performance of its shows and movies.
"The goal of separating the publication of the report from our earnings results is to keep the focus on our primary financial metrics — revenue and operating profit," the company said.
The flip side to that argument: If Netflix felt good about its engagement numbers, it would share them more often.
If you are a close Netflix observer, this move will have a familiar echo. In April 2024, Netflix announced it would no longer release subscriber data every quarter. And it used a similar rationale: It wanted Wall Street to stop paying attention to subscriber data and focus on other metrics instead.
Here, it's important to note that Netflix isn't required to release either data sets, at all. And that many of its competitors — including YouTube, its most formidable foe — provide very little data about their services.
So even though the company has become meaningfully less transparent over the last couple years, it still leads its peer set, by a lot. And while some of the impetus in releasing viewership numbers is to impress Wall Street, it isn't the only reason. Netflix also uses those numbers to woo Hollywood talent who worry their shows and movies may get lost amid all the streamer's offerings.
But the most important context here is the obvious one: Netflix has been getting grief from analysts and investors about worrying trends evident from the data that it has been putting out. The main one: Netflix subscribers appear to be spending less time with Netflix content than they have in the past.
And this month, Bloomberg highlighted that issue — using data directly from Netflix — with a report that showed that some of Netflix's biggest shows are seeing a steep drop-off in their second seasons.
Netflix has multiple answers to engagement worriers. It says that its engagement numbers are actually good, for starters. And on the company's earnings call on Thursday, co-CEO Ted Sarandos insisted that the company's second-season drop-offs are much less than its peers, for instance.
More broadly, the company has been arguing for a while that "quality of engagement" matters more than sheer tonnage. "As we've developed an increasingly sophisticated understanding of how consumers ascribe value to our service, we know not all hours are equal," the company said in its investor letter.
Still, you can tell Netflix is quite sensitive about the engagement issue: The word "engagement" shows up 13 times in Thursday's investor letter.
I don't know whether Wall Street will care about any of this. For years, investors obsessed about Netflix subscriber numbers — so much so that every other entrant in the streaming wars went out of their way to boast about their subscriber numbers. Then Netflix moved on, and investors seemed to move on, too.
But in the last year, Netflix stock has performed miserably, down 40%. A big chunk of that decline came from investors who worried about Netflix's plan to buy Warner Bros. Discovery for $83 billion — partly because they didn't like the idea of Netflix laying out that much cash and taking on debt, and partly because of the suggestion that Netflix felt it needed to spend that much to goose growth again.
But even though Netflix ended up walking away from that deal, it didn't solve its stock problem. Maybe this will help.
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Peter Kafka You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Peter covers media and technology for Business Insider; previously he has worked at Vox, Recode, AllThingsD, and Forbes. He was also the first hire at Silicon Alley Insider, Business Insider's predecessor.
Netflix uvedl, že ve 3. čtvrtletí čeká růst tržeb o 12 % a za celý rok o 13 % až 14 %. Tahounem mají být přírůstky předplatitelů, vyšší ceny a reklama.
MarketBeat Week in Review – 06/29 - 07/03Netflix NASDAQ: NFLX executives said the company remains on track for its 2026 financial plan, pointing to continued subscription growth, pricing gains, rising advertising revenue and a broadening content strategy during the company’s second-quarter earnings interview.
CFO Spence Neumann said Netflix is guiding for 12% reported revenue growth in the third quarter and 11% growth on a foreign-exchange-neutral basis. He said the drivers are “very similar to Q2,” led primarily by subscription revenue growth from membership gains and pricing, along with higher advertising revenue.
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Netflix Stock Is Near 2021 Levels, and Bulls See 4 Reasons to Care“We continue to see healthy acquisition and retention trends on the membership side, and our recent price adjustments are going well on the pricing side,” Neumann said.
For the full year, Neumann said Netflix expects 13% to 14% top-line growth, or roughly 12% on an FX-neutral basis, representing about $6 billion of incremental revenue year over year. He also emphasized that management is focused on the full year rather than quarter-to-quarter fluctuations.
The Netflix-Lionsgate Rumor Exposed a Bigger Shift in Media M&ANeumann said Netflix believes it still has significant room to grow, estimating the company is less than 45% penetrated into about 800 million addressable households globally, has captured about 7% of an addressable revenue market of approximately $670 billion, and accounts for about 5% of global TV viewing share.
Engagement Metrics Remain a Focus Co-CEO Greg Peters addressed investor questions about viewing hours and engagement, saying there is not a direct linear relationship between raw viewing hours and revenue or profit. He cited live programming as an example, noting that live content is expected to account for about 5% of Netflix’s content budget this year but only about 1% of view hours. However, Peters said six of Netflix’s top 10 new member sign-up days over the past five years have come from live events.
By contrast, Peters said kids and family animation series are also expected to represent about 5% of content spending but about 8% of view hours. He said Netflix evaluates engagement across quality, variety and quantity, rather than relying only on total hours viewed.
On the quantity side, Peters said viewing hours grew 2% in the first half of 2026, an incremental 1.5 billion hours compared with the same period last year. He said that was a slight acceleration from 1.5% growth in 2025.
“It’s combined quality, variety, and quantity of engagement that translates into satisfaction and value for members,” Peters said, adding that Netflix continues to see “industry-leading retention,” increased willingness to pay and strong advertiser demand.
Content Spending and Slate Performance Co-CEO Ted Sarandos said most of Netflix’s programming spending continues to go toward core TV series and films, where he said the company has a long track record of generating member value and business returns. Sarandos said Netflix is forecasting content expense to rise about 10% this year, above the 8% average over the last five years but below the 14% average over the past decade.
Sarandos pointed to several second-quarter releases as evidence of the slate’s performance, including “I Will Find You,” which he said was Netflix’s biggest original series launch this year, and “Swapped,” which he said is on track to become the company’s second-biggest original animated film behind “K-Pop: Demon Hunters.”
He also highlighted regional programming, including the South Korean show “Teach You a Lesson,” which he said is on track to become the second-most-watched South Korean show globally on Netflix and the company’s biggest series in South Korea. Sarandos also cited “The Polygamist,” adapted from a Zimbabwean novel for South Africa, and “Rosario Tijeras” in Latin America.
Asked about concerns over second-season viewership declines, Sarandos said Netflix is not seeing a material change in aggregate second-season viewing compared with first seasons. He said second seasons are performing within expectations and that second-season falloff has “slightly improved” this year compared with last year. He also said there are no changes to Netflix’s release strategy.
Live Events, Partnerships and New Formats Sarandos said live programming is playing an important role in driving acquisition, accelerating advertising revenue and generating conversation. He cited the World Baseball Classic in Japan, which he said became Netflix’s most-watched program ever in Japan and the biggest baseball streaming event ever.
While Sarandos said such live events can show slightly higher churn because they drive disproportionate sign-ups, he said results were in line with expectations and Netflix plans to continue expanding its global live event calendar, including regional live events.
Peters also discussed Netflix’s partnership with TF1 in France, saying the integration is still early at four weeks but that the company is pleased with the performance so far. He said the arrangement adds local French programming for members while maintaining a distinct product experience for TF1’s brand.
Asked about a potential free ad-supported streaming television, or FAST, offering, Peters said a free option could make sense in some markets, but Netflix must be thoughtful about cannibalization of paid tiers and would need an effective scaled advertising business in the relevant country. He said Netflix has no near-term plans to launch such an offering.
Sarandos said Netflix is encouraged by early progress in vertical clips and video podcasts, saying podcasts are driving incremental viewing, particularly during daytime hours and on mobile. He cited partnerships with publishers including Condé Nast, Hearst and People, as well as programming involving creators and brands such as Martha Stewart, “The Breakfast Club,” the official “Bridgerton” podcast, Bill Simmons, Pete Davidson and Brian Williams.
Advertising, Pricing and Games Peters said Netflix manages its advertising business for total revenue growth and sees an opportunity to narrow the gap between average revenue per membership on the ad tier and the standard ad-free tier. He said Netflix has expanded demand sources, continued building its own ad technology stack, added products and measurement tools, and made it easier for advertisers to transact with the company.
On pricing, Peters said recent increases in markets including the U.S., Mexico and Spain have gone well and are consistent with prior price changes and expectations. He said Netflix evaluates whether it has delivered sufficient member value before raising prices.
Peters also discussed Netflix’s video game strategy, saying the gaming market represents about $150 billion in consumer spending excluding China and Russia and not including advertising revenue. He said cloud-based TV games are showing positive signs, with FIFA and Unhinged becoming Netflix’s two most successful cloud game debuts. Since scaling the cloud initiative last October, Peters said monthly active players for cloud games have increased 11 times.
AI, M&A and Capital Allocation Sarandos said generative AI is beginning to affect hundreds of Netflix productions, with workflows used in roughly 300 titles, especially in post-production. He said the tools are helping with complex shots and sequences, including crowd enhancements and historical battle scenes, while allowing some work to be completed faster and more efficiently.
Sarandos cited the documentary series “The American Experiment,” which he said includes 17 minutes of AI-enhanced footage produced twice as fast and at half the cost of prior options. He said any cost savings are likely to be reinvested into more content.
Asked about media consolidation and speculation around acquisitions, Sarandos said Netflix would not comment on market speculation and reiterated that the company is “primarily builders, not buyers.” Neumann said there is no change to Netflix’s capital allocation philosophy, which includes investing in the business, maintaining liquidity and a healthy balance sheet, and returning excess cash through share repurchases.
Neumann said Netflix repurchased $4.7 billion of shares in the second quarter, its largest quarterly repurchase in company history, and still has about $27 billion of capacity remaining under its authorizations.
About Netflix (NASDAQ:NFLX)Netflix, Inc NASDAQ: NFLX is a global entertainment company that provides subscription-based streaming of films, television series, documentaries and other video content. Founded in 1997 by Reed Hastings and Marc Randolph and headquartered in Los Gatos, California, the company began as a DVD-by-mail rental service and introduced streaming video in 2007. Netflix later expanded into producing and distributing original programming, beginning notable original hits in the 2010s, and now operates a content production and distribution ecosystem alongside its licensing activity.
The company's primary product is its on-demand streaming service, which can be accessed on a wide range of internet-connected devices and delivered through a suite of apps and web platforms.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
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Netflix odmítá velké akvizice a říká, že je „primárně stavitel, ne kupující“. Firma zároveň uvedla, že nemá žádné krátkodobé plány na spuštění FAST kanálů.
Netflix Co-CEOs Ted Sarandos and Greg Peters used the company’s second-quarter earnings interview to try to clear the air regarding prospects for M&A, strategic partnerships and FAST channels.
Responding to a question about Lionsgate or NBCUniversal, both considered prime suspects in the current wave of consolidation, Sarandos told Wall Street analysts he wanted to remind them of the company’s “core philosophy.” Netflix has “multiple ways to achieve our goals,” he added, among them “producing, licensing, partnering. And we’re constantly seeking ways to allocate our resources to the most attractive options.”
Repeating the same mantra that Peters offered up last fall as reports swirled about a potential run at Warner Bros. Discovery, Sarandos said, “We’re primarily builders, not buyers. That remains the case today. So, others will speculate about our intentions because they have their own reasons for that. But our track record is clear that we have a very high bar to do any big M&A.”
The remarks came after the company reported mixed second-quarter results and predicted a slight slowdown in growth in the third quarter. The numbers and projections seemed to only add to existing skepticism on Wall Street, sending Netflix shares down nearly 9% in after-hours trading. The stock has fallen more than 40% over the past year, and did not rebound after Netflix abandoned its bid for WBD and ceded the prize to Paramount (collecting a $2.8 breakup fee in the process). Questions have lingered since the merger battle, chiefly about why Netflix felt it needed to attempt by far the priciest M&A deal in its history and also whether it would feel compelled to explore other deals in the current climate of consolidation.
Peters, who steered the company’s milestone partnership with French broadcaster TF1, was asked about early takeaways from the venture and whether it might consider similar arrangements with other partners. There have been reports, for example, about NBCU streamer Peacock potentially looking to forge a partnership with Netflix. The company doesn’t do many bundles, though it is part of Comcast’s Xfinity StreamSaver package.
“Since the very beginning when we launched our streaming service, we’ve always sought to expand the entertainment offering,” Peters said. “Our members consistently tell us that they want more from us. We see that in the usage behavior. We see it any kind of testing or modeling we do around the space. And I would say that fulfilling on that customer desire for more has really been the driver for growth for our business for the last two decades. This partnership with TF1 is yet just another approach to expanding that offering.”
With a global footprint of 330 million households, he added, “We believe that we can help other producers, other services maximize the value and the relevance of the content that they invest in by finding those bigger audiences. And we have many, many examples of this effect, including now, in this new model with TF1.”
Given the TF1 integration only took effect last month in France, “it’s early,” Peters said. “There’s a bunch that we’ll learn through this process, but we are pleased with the performance we are seeing. … The early results from how members are reacting, how they’re interacting are very promising.”
While no follow-on agreements are ready to announce, Peters added, “if we see additional deals that similarly serve our members, that work for our partner, that work for us, we’ll certainly consider them.”
FAST channels, which have become a multi-billion-dollar category explored by virtually every rival streamer, remain uncharted territory for Netflix. Numerous press reports in recent months have speculated that the company could license third-party programming or use its existing library to launch FAST channels, which could potentially boost advertising revenue and subscriber levels.
“Maintaining and increasing accessibility, especially as we expand our content offering around the world, add new customer segments, that’s a critical focus and goal for us,” Peters said. “Optimizing long-term revenue is the other big goal. A free offering could make sense in some markets, but we have to be thoughtful about cannibalization of pay tiers. We’ve got to ensure that we’ve got the right offering, the right differentiation, differentiation of that offering.”
Peters added that “an effective, scaled ads business in any candidate country for such an offering is clearly an important enabling factor to make those economics work.” Given that Netflix only recently expanded its ad tier beyond its initial 12-territory footprint, it would need time to continue maturing.
“That’s all to say that free is something that we’re gonna continue to consider, but we have no near term plans to launch something,” Peters said.
Netflix čeká v roce 2026 růst výdajů na obsah zhruba o 10 % na asi 20 miliard USD. Generativní AI už použil v asi 300 titulech a zrychluje i zlevňuje postprodukci.
Streaming giant Netflix anticipates content spending (of about $20 billion) will be up around 10% in 2026, accelerating from 8% increases over the last five years but below the 14% the company averaged over the past decade. Live, now a focus, will be about 5% of total.
The higher outlay comes even as generative AI lowers costs, allowing the streamer to make “higher quality output more quickly and efficiently,” said co-CEO Ted Sarandos in a video call after quarterly earnings Thursday. He said Gen AI workflows have been used in roughly 300 Netflix titles, concentrated in post-production.
“We’re leveraging Gen AI for really complicated shots and sequences… enhancing crowds, or historical battle scenes, those kind of things,” he added. “And keep in mind that that in many of the cases productions would have left out those key shots because they just wouldn’t have been able to afford them. So they’re saved by availability and access to these Gen AI tools.”
AI use cases “are scaling faster and faster,” he said. Documentary series The American Experiment features 17 minutes of AI-enhanced footage, which was “produced twice as fast and at half the cost of previous options.”
Cost savings will likely be reinvested in more content on the service, which fuels engagement and the “whole revenue, profit flywheel.”
The comments followed lackluster second quarter financials with execs on the defensive as analysts grilled the company on what Wall Street perceives as a bit of a slump.
Live was a big topic as the streamer continues to ramp up its slate. Sarandos lauded live programming for driving subscriber acquisitions, accelerating ad revenue, fueling conversation and helping launch new shows. It’s been expanding its live sports lineup. He also called out The Roast of Kevin Hart and the MLB Home Run Derby, which was followed by an exclusive Hot Ones special (via a partnership with Sean Evans) shot at a baseball stadium with guest Will Ferrell, whose new series The Hawk just debuted on Netflix.
It’s “a cool example of the intersection between our core series, our expansion to creator content … plus live sports,” Sarandos said.
He also touted new vertical video clips, podcasts and content deals with publishers including Condé Nast, Hearst and People that will bring more lifestyle programming, saying, “Over the last 15 years, the definition of TV has broadened and our definition has changed along with it.”
Netflix uvedl, že sledovanost v 1. pololetí 2026 vzrostla o 2 % oproti 1,5 % v roce 2025. Zároveň ale od příštího roku bude report o sledovanosti zveřejňovat jen jednou ročně.
LOS ANGELES, CALIFORNIA - DECEMBER 05: An aerial view of the Netflix logo displayed at Netflix studios, with the Hollywood sign in the distance, on December 5, 2025 in Los Angeles, California. Netflix and Warner Bros. Discovery, Inc. have announced an $82.7 billion deal for Netflix to acquire Warner Bros. film and TV studios, HBO Max, and HBO. (Photo by Mario Tama/Getty Images)
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Netflix earnings numbers are always highlighly anticipated by media industry analysts and investors, given its size and influence in the streaming television business.
But this Q2 2026 earnings report was especially important because it came at the end of a couple of weeks of bad press, including a discussion about whether or not audience engagement numbers are dropping at the streamer.
And when the company released its 8-K form on Thursday, ahead of a conference call discussing the numbers by Netflix executives, the earnings numbers had a lot of things to worry about if you are an investor in the company.
If reading the 8-K was a drinking game in which you did a shot every time the document mentioned “engagement,” you’d be drunk before you got halfway through the 20-page document.
Netflix wants you to know that despite the press reports, their subscriber engagement numbers are just peachy:
We’re delivering increasing value to our members; engagement is healthy, reflecting the quality, quantity, and variety of our offering...View hours grew +2% in H1’26 vs. +1.5% growth in 2025, despite the competitive impact of the Winter Olympics and the World Cup this year.
Netflix is also arguing that while engagement numbers are important, there are other metrics that are as or more important when it comes to judging the overall success of the company:
We’ve used “engagement” as a shorthand for the value we deliver members. But, as we’ve developed an increasingly sophisticated understanding of how consumers ascribe value to our service, we know not all hours are equal. Time spent is just one aspect of strong engagement - quality and variety also matter. The key is to improve across all of those dimensions: quality, variety, and quantity.
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I’m not convinced that the argument “sure, engagement is an issue, but have a lot of titles people like” is a winning approach. Especially at the same time in which the streamer announced that next year, it will release the “What We Watched” report on an annual basis only. That report tracks viewing numbers and engagement on Netflix.
There were some interesting data points mentioned in the 8-K, although there wasn’t much provided in the way of context:
For instance, approximately half of our viewing occurs in the evening, but our recently launched video podcasts over-index on viewing during the day and on mobile devices, an indicator that this engagement is incremental.
Presumably, the other half of Netflix’s viewing occurs in the daytime hours. And what exactly does “over-index” mean when discussing am initiative which is still being rolled out?
Also, this video podcasts initiative has been partially limited to more mature markets such as North America, the UK, Europe and Australia. So how do engagement numbers in the territories with podcasts compare to those places where subscribers don’t have access? What do the financials for the video podcast deals look like? How long do the deals last?
But let’s not forget engagement:
Overall, our engagement remains healthy and as with all things we do, we’re working hard to improve every day.
And in fact, during a call company executives held with analysts and reporters after the 8-K was released, Co-CEO Ted Sarandos argued that engagement issues were “very common” in the industry (something I wrote about earlier in the week) and he also said that Netflix’s engagement numbers have recently improved somewhat:
“We are not seeing any material change in our second season viewing compared to season ones, our second seasons are performing well within our bands of expectation. Very often we see drop off from season one to season two. It’s very common in the industry, but it’s even more so with us because we launch our shows so big. When we look across the entire portfolio, across all the regions, all the content categories, our season two fall off is actually slightly improved this year relative to last year. Now, of course, you can pick any five data points to tell any story you want, but I’m going to repeat this: our season two fall off is actually slightly improved this year relative to last year.”
As for live events, the news is mixed for Netflix. Company executives noted that live events accounted for six of the top 10 new member sign-up days over the past five years. Which makes sense given that in mature markets, most likely subscribers have already joined. So live events provides a unique entry point for more reluctant subscribers.
Still, Netflix noted that while live programming accounts for more than 5% of its content spending, it makes up only about 1% of viewing hours.
However, the biggest challenge for investors and analysts is that the decision by Netflix to report engagement numbers less frequently only adds to the list of basic financial and strategic metrics that aren’t being reported anymore by the company. Or other companies in the streaming sector, to be fair.
As I wrote about in my Too Much TV newsletter after Netflix’s Q1 2026 report, it’s almost impossible to determine the success or failure of strategy at the company given the lack of details that would be reported by companies in other industries.
While Netflix likes to focus on revenue, it’s more important to be able to figure out where that revenue comes from and what a company has to do in order to generate it. And the standard across most industries is what is called the CLV - customer lifetime value. Which is the average amount of revenue each new and current customer is expected to generate over the life of their subscription.
Which means that you calculate the CLV by average revenue per account, times the gross margin, divided by the average subscriber churn rate.
And we don’t have any of those numbers. The scant top-line information Netflix provides is broken down by territory. And that means countries with higher ARPAs are combined with countries with much lower ARPAs and then averaged across the territory.
There is no way to know what strategies are successful or where weaknesses might be bubbling up.
I have been covering Netflix since it was a one-DVD warehouse in the SF Bay area. I have been supportive of a lot of the decisions made by the company over the years. But it is uniquely frustrating to cover a company what ends up making me feel as if I’m trying to cover the decisions of the Wizard Of Oz while he’s hiding behind billows of smoke and a giant curtain.
Netflix ve 2. čtvrtletí zvýšil tržby na 12,56 miliardy USD a čistý zisk na 3,4 miliardy USD, ale výhled na 3. čtvrtletí zklamal. EPS 0,80 mírně překonal odhad 0,79.
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This live blog is being updated by Thomas Richmond, a 24/7 Wall St. contributor. You’ll get expert analysis of Netflix’s Q2 earnings.
Simply stay on this page, and new updates will appear below automatically. We expect Netflix to release earnings shortly after 4:05 p.m. ET.
1 minute ago
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That wraps up our initial coverage of Netflix’s Q2 results. Thank you for stopping by!
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Netflix continues to grow, with second-quarter revenue reaching $12.56 billion, net income totaling $3.4 billion, and EPS of $0.80 narrowly beating the $0.79 estimate. The company also expects advertising revenue to roughly double to $3 billion in 2026.
The problem was guidance. Netflix expects third-quarter revenue of $12.86 billion and EPS of $0.82, below estimates of $13.01 billion and $0.84, respectively.
For a stock carrying a premium valuation, continued growth is not enough when Wall Street expects even more.
The sell-off now raises the question for investors: Is Netflix undergoing a healthy valuation reset, or is the pullback creating a long-term buying opportunity?
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Overall Grade: B-. Netflix (NASDAQ:NFLX | NFLX Price Prediction) beat EPS but missed on revenue, free cash flow, and Q3 guidance, muting the rebound narrative built up during earnings week.
Category Grade Notes Revenue Performance C+ Revenue of $12.56B narrowly missed the $12.58B estimate despite 13.37% YoY growth. Earnings Beat/Miss B EPS of $0.80 topped the $0.7883 consensus by 1.48%. Guidance Quality C- FY narrowed to $51.0B-$51.4B; Q3 revenue of $12.86B came in light. Margin Trends B+ Q2 operating margin of 33.4% ran slightly ahead of internal targets. Cash Flow D Free cash flow of $1.53B fell 32.73% YoY on higher cash taxes. Management Confidence A- New $25B buyback authorization; $4.7B repurchased in Q2. Resilient top-line growth and strong margins collide with softer forward metrics.
The aggressive buyback signals conviction, while FCF pressure gives bears ammunition heading into the 4:45 PM ET call.
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Netflix still expects ad revenue to roughly double year over year to about $3 billion in 2026, providing another growth engine alongside pricing and global subscriber engagement.
Netflix reported more than 97 billion viewing hours during the first half, up 2% year over year.
Regional growth was broad-based, led by a 21% revenue increase in Latin America, followed by 16% growth in Asia-Pacific, 14% in Europe, the Middle East and Africa, and 10% in the United States and Canada.
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Netflix’s second-quarter revenue of $12.56 billion narrowly missed estimates, while free cash flow fell 33% to $1.53 billion, well below the $2.72 billion expected.
Netflix attributed the cash-flow pressure to higher tax payments, partly related to the Warner Bros. Discovery termination fee.
The company’s third-quarter outlook also missed across the board. Netflix expects revenue of $12.86 billion, EPS of $0.82, and a 33.2% operating margin, all below Wall Street’s forecasts.
Its full-year outlook calls for approximately $12.5 billion in free cash flow and a 31.5% operating margin, compared with estimates of $13.09 billion and 31.7%, respectively.
44 minutes ago
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Netflix just reported Q2 earnings, with shares initially up 2% following the report. Here are the key numbers:
Revenue: $12.56 billion vs. $12.58 billion expected EPS: $0.80 vs. $0.79 expected Quick Read:
Netflix delivered a small EPS beat, although revenue fell slightly short of Wall Street’s expectations.
Revenue still increased 13% year over year, while EPS rose 11%, signaling that the company’s underlying growth remains healthy.
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Netflix (NASDAQ:NFLX) reports Q2 earnings tonight at 4:05 PM ET, with shares at $73.72 and down 21.42% YTD.
Bull Case Ad revenue tracking to roughly double to about $3 billion in 2026, with the advertiser base up over 70% year over year. Reaffirmed FY operating margin of 31.5% on 12% to 14% revenue growth. Polymarket now assigns a 59.5% beat probability, and July 17 call volume outpaces puts 2.46:1. Bear Case Q1 EPS missed by -8.55% even with the Warner Bros. windfall. Content amortization peaks in Q2, threatening margins. Misses have averaged a -9.89% day-of drop, and insiders are net sellers across 110 recent transactions. Valuation remains full at a 24 P/E. 1 hour ago
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With shares at $73.72 and down 21.42% YTD, Netflix’s Q2 earnings call at 4:45 PM ET tonight will help to set the tone for the back half of the year.
Top Analyst Questions: Is ad revenue on track to reach the $3 billion 2026 target? How is capital being deployed post-Warner Bros., with $6.8 billion in buyback authorization remaining? Has content amortization truly peaked? What are early Netflix Playground and vertical-feed engagement metrics? Any update on the Brazilian ~$700M tax dispute? Key Topics: Free-trial reintroduction, Spain price hike, Mercado Libre bundle, InterPositive GenAI integration.
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Buzzwords: “incrementality,” “conversational discovery,” “operating leverage,” “engagement per member.”
Red Flags: Guidance below the 32%-34% margin consensus, softer H2 ad ramp, or hedged language on Lionsgate M&A speculation.
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With Netflix (NASDAQ:NFLX) set to report after the close, the Q1 setup remains the single most important frame for interpreting tonight’s numbers.
Here are 3 of the most important items from the April call to keep in mind ahead of tonight’s Q2 earnings:
Last Quarter’s Top 3 Takeaways: Capital return posture flipped back to normal. After walking away from the Warner Bros. deal, Netflix booked a $2.80 billion termination fee and resumed buybacks, repurchasing 13.5 million shares for $1.3 billion with $6.8 billion remaining. With shares now near $74.26, pace-of-buyback commentary matters more than usual. The ad tier inflected faster than the Street modeled. Ad-supported plans drove over 60% of sign-ups in ads countries, the advertiser base grew over 70% year over year to more than 4 thousand advertisers, and management reiterated the $3 billion ad revenue target. Any wobble tonight would dent the core bull thesis. Q2 is the margin trough, by design. Content amortization was flagged to peak in Q2 before decelerating to mid-to-high single digits in the back half, with the Q2 operating margin guide set at 32.6% on revenue of roughly $12.574 billion. FCF guidance was also raised to ~$12.5 billion from $11 billion, so any print above the 32.6% line would signal Q1’s confidence was, if anything, understated. Prediction markets currently assign a 60.5% probability of a miss, with 66.5% clustering around a 32%-34% operating margin outcome.
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Netflix (NASDAQ: NFLX) heads into tonight’s earnings report with Wall Street and prediction markets telling two very different stories.
The company is targeting roughly $12.57 billion in second-quarter revenue and a 32.6% operating margin, even as content amortization is expected to peak during the quarter.
Advertising remains the clearest potential catalyst, with ad revenue reportedly on track to double to approximately $3 billion in 2026.
Wall Street analysts maintain an average price target of $112.17, implying 51.5% upside. However, prediction markets assign Netflix a 60.5% probability of missing expectations, with $70 emerging as the most likely post-earnings share price.
A clean beat on advertising revenue and operating margin would revive Netflix’s long-term compounding narrative, but weakness in either metric would strengthen the bear case.
Netflix is also looking to overcome concerns that audiences for viral shows can decline 30% to 70% between seasons.
Netflix (NASDAQ:NFLX) reports Q2 earnings tonight at 4:05 PM ET, with the earnings call scheduled for 4:45 PM ET. The report lands after a Q1 EPS miss and a 41.54% one-year decline, leading investors to hope for a re-rate on margin durability and ad-tier scale.
A Valuation Reset for Netflix Stock Q1 2026 delivered revenue of $12.25 billion, up 16.19% YoY and beating consensus by 0.63%, while EPS of $1.23 missed the $1.345 estimate by 8.55%.
Management reaffirmed FY 2026 revenue guidance of $50.7B to $51.7B and lifted free cash flow to ~$12.5B. The ad-supported tier drove over 60% of Q1 sign-ups in ad markets, with advertisers up 70% YoY to over 4,000 clients.
Consensus Estimates Metric Q2 2026 Guide/Est YoY Change FY 2026 Guidance Revenue $12.574B +13% $50.7B-$51.7B Operating Margin 32.6% expansion 31.5% EPS (Est) $0.79 n/a n/a The Q2 revenue target implies 13% YoY growth (12% F/X neutral). The 32.6% margin projection exceeds the FY 31.5% target because Q2 is the peak amortization quarter, followed by expected deceleration to mid-to-high single digits in H2. Polymarket assigns a 66.5% probability to the company’s margins landing in the 32%-34% band.
Ad Scale, Amortization Peak, and Post-Warner Positioning With Netflix’s Q2 earnings tonight, ad revenue trajectory might be the single biggest swing factor. I’ll be watching whether advertiser count extended past the 4,000 client mark and how new incrementality tools are landing with buyers.
Content amortization is set to peak this quarter before decelerating. Any slippage below 32% might challenge the full-year 31.5% guidance.
Pricing power warrants attention after recent price adjustments in Spain. Commentary on member response and churn will inform whether North America and EMEA can sustain price-led ARPU growth.
The company did not acquire Warner Bros. Discovery, so the termination fee resumed the $6.8B buyback authorization, and 13.5M shares were retired for $1.3B in Q1. I’ll focus on content M&A appetite and whether GenAI investments (the InterPositive acquisition) reshape production economics.
Finally, live events and gaming. The Tyson Fury vs Anthony Joshua fight, Netflix Playground, and Japan’s World Baseball Classic success are new engagement vectors. Management tone on monetization pathways matters.
Earnings History Quarter EPS Surprise 1-Day Move 7-Day Move 30-Day Move Q1 2026 -8.55% -9.72% -5.00% -8.20% Q4 2025 +1.43% -0.84% -1.93% -9.84% Q3 2025 -15.79% -10.07% -1.43% -6.56% Q2 2025 +1.89% -5.10% -2.38% +0.41% On average, shares moved -2.69% seven days after earnings over the past year.
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Item 1 of 2 A drone view shows Netflix logos on buildings in the Hollywood neighborhood in Los Angeles, California, U.S., January 20, 2026. REUTERS/Daniel Cole
[1/2]A drone view shows Netflix logos on buildings in the Hollywood neighborhood in Los Angeles, California, U.S., January 20, 2026. REUTERS/Daniel Cole Purchase Licensing Rights, opens new tab
SummaryCompaniesNetflix forecast third-quarter revenue of $12.86 billion and diluted EPS of 82 centsShares drop nearly 8% in after-hours tradingIt will cut viewing-hours reports to once yearly starting in January 2027LOS ANGELES, July 16 (Reuters) - Netflix (NFLX.O), opens new tab offered third-quarter revenue and earnings projections on Thursday that hovered below Wall Street targets and said it would reduce the amount of information it discloses on viewing hours as the streaming video pioneer seeks new avenues of growth in a competitive media landscape.
Shares of Netflix fell nearly 8% in after-hours trading to $68.45.
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The company said it expected $12.86 billion in revenue from July through September and diluted earnings per share of 82 cents. Analysts had forecast $13 billion in revenue and diluted EPS of 84 cents, according to LSEG.
Third-quarter projections "appear to reflect a combination of management caution and a naturally maturing growth profile, rather than any sudden deterioration in the business," PP Foresight analyst Paolo Pescatore said. He added that they would "reinforce the view that Netflix remains strong but is entering a steadier phase of growth with considerably less room for error given the always-high expectations."
Netflix said it would cut its biannual release of a viewing-hours report to once a year starting in January 2027 "to keep the focus on our primary financial metrics — revenue and operating profit." It stopped publishing quarterly subscriber numbers in 2025.
For the just-ended quarter, Netflix revenue and EPS were roughly in line with analyst estimates. Earnings per share came in at 80 cents for the three-month period, which featured hits including crime drama "I Will Find You" and animated feature "Swapped." Revenue totaled $12.56 billion.
"Our financial performance remains solid and we're on track to meet our objectives for the year," the company said in its quarterly letter to shareholders.
COMPETITION INTENSIFIESNetflix is facing competition from all corners of the entertainment industry, from traditional media companies such as Walt Disney (DIS.N), opens new tab to YouTube, a growing presence in living rooms, and mobile viewing on apps such as TikTok.
Prior to the earnings report, the streaming giant had shed over a fifth of its value as investors worried about how the company would boost revenue and gain new customers. In April, Netflix said it had more than 325 million paying members and still had room to increase that number.
The company is building an advertising business and offering video games, two initiatives still in the early stages. It repeated an earlier forecast that ad revenue would reach $3 billion by the end of the year. The company is counting on its growing number of live events, including an expanded NFL slate, to draw more advertising dollars.
Netflix said engagement, or the amount of time people spend watching the service, was "healthy." Viewing hours grew by 2% in the first half of the year, compared with 1.5% a year ago.
It said it aimed to stay ahead of the competition in part by using technology to improve all aspects of its business. Use of generative artificial intelligence by producers is "scaling quickly" and has been used in about 300 titles, mostly in post-production, the company said.
Reporting by Lisa Richwine in Los Angeles and Ed Lee in New York; Editing by Sayantani Ghosh and Matthew Lewis
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Netflix (NASDAQ:NFLX | NFLX Price Prediction) is becoming a media conglomerate. A cascade of moves in 2026 across sports, gaming, retail, advertising, podcasts, and mergers looks less like adjacent experiments and more like the blueprint of a media conglomerate. The question for Netflix shareholders is whether this sprawl is smart reinvention or a distraction the market is punishing.
The Case That Netflix Is Becoming a Conglomerate Start with live sports. Netflix has secured exclusive global streaming rights to the MLB Home Run Derby, Opening Night, and the Field of Dreams Game in a roughly three-year, $50 million per year deal, its first major live sports broadcast package. That follows the World Baseball Classic in Japan (47 games), which became the most-watched Netflix program ever in that country, plus the Canelo vs. Crawford bout, which drew more than 41 million viewers.
The expansion extends beyond sports. Netflix has opened Netflix Houses in Dallas and King of Prussia, PA; launched the Netflix Playground standalone kids gaming app across six countries; rolled out video podcasts with partners like Spotify/The Ringer, iHeartMedia, and Barstool Sports; and poured roughly $1 billion into a Fort Monmouth, N.J., production hub with 12 new soundstages. The advertising arm alone grew more than 2.5x to over $1.5 billion in 2025 and is expected to reach about $3 billion in 2026.
Then there’s M&A. Netflix walked away from a Warner Bros. deal, collecting a $2.80 billion termination fee that helped push Q1 2026 net income to $5.28 billion. Reports now put early-stage talks around Letterboxd at roughly $250 million, with Netflix’s name also circling Lionsgate Studios, valued near $3.86 billion. Both should be treated as rumored rather than confirmed.
Reinvention or Costly Sprawl? The market is skeptical. Shares are down 21.6% year to date and 41.1% over the past year. Reddit’s most upvoted thread of the week framed it plainly: “Netflix is down 42% from its high and trading cheaper than the S&P 500, the July 16 earnings are going to be fascinating.” Prediction markets assign a 75.5% probability of a Q2 earnings beat, yet 72.5% odds that the stock closes down on July 16. Insider activity has leaned toward selling.
Still, the fundamentals underpinning the strategy are formidable: a $309.7 billion market cap, 48.5% ROE, and 29.7% operating margin, on a P/E near 24. (Investors weighing whether streaming’s champion belongs in the same conversation as AI-boom names may want to keep 24/7 Wall St.’s 7 Stocks Powering the AI Boom report on the radar for context on where growth capital is flowing.)
What to Watch Judge the conglomerate thesis on four signals: ad revenue tracking toward the $3 billion 2026 target, operating margin holding in the 32% to 34% band the market expects, engagement trends after price hikes, and whether free trial tests translate into net subscriber additions. Today’s earnings report is the first real test.
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