Episode summary
Instant Reaction: Netflix Disappoints Again with Slow Growth | Bloomberg Intelligence
Summary
Netflix disappointed investors again with guidance for a second straight quarter of slowing sales growth, projecting revenue of $12.9 billion and earnings of 82 cents a share, both slightly below expectations. The stock fell sharply after hours as the market focused less on the just-reported quarter and more on what the company said about the next one and the strength of future engagement.
The discussion split between a more defensive valuation view and a more cautious fundamental view. One guest argued Netflix looks like a “utility” now: a stable subscription business with big free cash flow, a large remaining buyback authorization, and pricing power that has lifted average revenue over time. That guest said the recent selloff makes the shares look attractive on a relative basis.
Other speakers pushed back, saying the service still lives and dies by hits. They pointed to a 2025 hangover from major titles, softer engagement, and the company’s effort to expand beyond TV and movies into video podcasts, live programming, short-form video, and ads. The analyst said management does not yet have the same clear levers it used in 2022, making the bearish case harder to dismiss.
Key takeaways
- The host said Netflix projected $12.9 billion of revenue and 82 cents a share, both a bit below Wall Street expectations.
- One guest argued Netflix is now a “utility” with big free cash flow, pricing power, and a large buyback still available.
- The analyst said investors wanted stronger operating margin guidance and saw the weaker outlook as feeding the bearish case.
- A guest said Netflix’s 2025 run of huge hits created a “hangover,” making current engagement look weaker by comparison.
- The analyst said Netflix’s attempts to push into podcasts, live content, and short-form video suggest the model needs new growth levers.
Notable quotes
“The company projected revenue of 12.9 billion and earnings of 82 cents a share”
“We still believe in the story. We still believe in the growth opportunities”
“I think that shows a little bit of lack of confidence”
“Netflix is trying to convince the market that there is like this second act beyond us being focused on subscriber growth”
How the episode opens
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From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- netflix revenue growth
- streaming stock selloff
- analyst expectations
- after-hours trading
- streaming competition
Companies and tickers mentioned
- NFLX
- Netflix
- Warner Bros. Discovery Inc.
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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