BUSINESS

Los Gatos shares slide as Netflix cuts growth outlook

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LOS GATOS, California, July 17, 2026 – Netflix Inc. shares fell as much as 10% in premarket trading on Friday after the company issued a softer-than-expected revenue forecast for the third quarter, deepening investor concerns about a slowdown in its growth. The decline followed a challenging stretch for the streaming giant, whose stock is already down 21% so far this year amid intensifying competition and changes in viewing habits. While the market reaction focused on the outlook, the latest quarterly report showed that Netflix continues to generate solid profits and double-digit revenue growth, underscoring the contrast between its current performance and more cautious guidance. For the second quarter of 2026, the company reported net profit of $3.4 billion, or 80 cents per share, up 9% from $3.13 billion, or 72 cents per share, a year earlier and slightly above Wall Street’s consensus estimate of 79 cents. Revenue grew 13.4% year-over-year to $12.56 billion, just below analyst expectations of $12.58 billion. The company projected third-quarter revenue growth of about 12%, or $12.86 billion, compared with analyst forecasts of roughly 13% growth, or about $13 billion. The guidance marked a second consecutive quarter of slowing sales expansion and helped trigger the premarket sell-off in the shares.

Prepared by Christopher Adams and reviewed by editorial team.

Timeline of Events

2025 Netflix begins facing intensifying streaming competition
Early 2026 Company warns of moderating subscriber additions
2026 year-to-date Netflix shares fall 21 percent
Second quarter 2026 Profit rises nine percent year-over-year
Second quarter 2026 Revenue slightly misses analyst expectations
Third quarter 2026 forecast Revenue growth guided to twelve percent
Friday July 17 2026 Shares drop ten percent premarket trading
Today Investors reassess Netflix long-term growth trajectory

Why This Matters to You

Netflix's falling shares could impact your investments if you hold stock in the company. It's a reminder to keep an eye on your portfolio and consider diversifying. If you're a Netflix user, this could lead to changes in pricing or content offerings down the line.

The Bottom Line

Despite a dip in growth, Netflix is still profitable and growing. The market's reaction may be more about future uncertainty than current performance. Worth forwarding if you know someone invested in Netflix or interested in the streaming market's trends.