Netflix Stock's Last Decade Was Spectacular. But What Will the Next Decade Look Like?

On July 18, 2016 (about 10 years agone to the day), Netflix (NASDAQ: NFLX) shares closed astatine a split-adjusted $9.88. A $10,000 concern astatine that terms would person bought astir 1,010 shares, and with the banal astatine astir $68 arsenic of this writing, that involvement would beryllium worthy astir $68,500 today. That works retired to a compound yearly instrumentality of astir 21%. The aforesaid $10,000 successful the S&P 500 (SNPINDEX: ^GSPC) would person grown to astir $35,000, earlier dividends.

That instrumentality wasn't earned comfortably, though. Holding meant sitting done immoderate disfigured weeks, including that precise one: the time aft Netflix's second-quarter 2016 study showed subscriber maturation coming successful good beneath the company's ain forecast, shares sank 13%.

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Anyone who bought into that plunge did adjacent better, turning $10,000 into astir $79,000.

And conscionable a fewer days agone (almost precisely 10 years later), Netflix fell hard aft a second-quarter study erstwhile again. Shares dropped astir 9% successful after-hours trading arsenic the streaming giant's forecast pointed to slower maturation ahead.

The harder call, I think, is whether Netflix tin support compounding from here. Its latest study offers immoderate clues.

Slowing maturation

Today's Netflix would beryllium astir unrecognizable to a 2016 shareholder. The institution present generates much gross successful a azygous 4th ($12.6 cardinal successful Q2) than the $8.8 cardinal it produced successful each of 2016.

The 2nd 4th itself was solid. Revenue roseate 13% twelvemonth implicit year, successful enactment with management's guidance, with double-digit maturation successful each region. Earnings per stock roseate 11% twelvemonth implicit twelvemonth to $0.80. And Netflix's operating borderline was 33.4%, down somewhat from 34.1% successful the year-ago 4th due to the fact that the company's contented amortization is increasing faster successful the archetypal fractional of the year. For the afloat year, absorption inactive expects an operating borderline of 31.5%, up from 29.5% successful 2025.

Also worthy noting: Engagement looks healthy. Members watched much than 97 cardinal hours of contented successful the archetypal fractional of 2026, the company's highest half-year full to date.

The occupation is the trajectory. Netflix's year-over-year gross maturation complaint has decelerated each 4th this year, from 17.6% successful the 4th fourth of 2025 to 16.2% successful Q1, 13.4% successful Q2, and a forecast of conscionable 11.7% for Q3. Management besides narrowed its full-year gross outlook to $51.0 cardinal to $51.4 billion, representing 13% to 14% growth.