Netflix Stock and Price Targets Drop as Wall Street Debates the Streamer's Future
By Georg Szalai
Global Business Editor, The Hollywood Reporter
Netflix co-CEO Ted Sarandos' highly anticipated third-quarter earnings report has Wall Street reacting with caution, including price target drops, amidst the streamer's largest layoffs in years.
Analyst Reactions:
Mark Mahaney, Evercore ISI
- Stock Rating and Price Target: Outperform, $90 (down from $110)
- Takeaways: "Is A Better Script Coming?" Mahaney asked in his report, noting that for the third consecutive quarter, Netflix shares dropped after soft earnings per share results and lighter guidance. He highlights that growth has clearly slowed at Netflix.
Other Key Takeaways:
- Content Strategy: Sarandos discussed content strategy, emphasizing the need for better execution in the U.S.
- Global Dependence: He acknowledged that international territories rely on successful titles to "travel around the world," suggesting a focus on global hits.
- Shortfall in Advertising Revenue: Co-CEO Greg Peters addressed a projected 2026 shortfall in advertising revenue.
- Staying the Course: Sarandos' key quote: "There is no need for a fundamental shift in the strategy... We do need better execution in the U.S."
In pre-market trading on Wednesday, Netflix stock dropped over 6% to a new 52-week low of $64.35. As of Tuesday's close, the low was at $65.08.