Now Streaming: Netflix falls after underwhelming Q2 guidance

PLAYING THIS WEEKEND: Among this weekend’s astir notable caller streaming contented is the archetypal 3 episodes of “Margo’s Got Money Troubles”, a caller dramedy starring Elle Fanning, Michelle Pfeiffer and Nick Offerman connected Apple TV (AAPL). Meanwhile, Netflix (NFLX) subscribers tin binge each 8 episodes of “Beef”, a acheronian drama anthology bid led by Carey Mulligan and Oscar Isaac for the 2nd season. Additionally, Amazon (AMZN) Prime Video users tin ticker “American Gladiators”, a reboot of the 90’s crippled amusement wherever amateur athletes vie against nonrecreational gladiators.

NETFLIX FALLS AFTER Q1 EARNINGS: Shares of Netflix fell aft the institution reported archetypal 4th net and gave a forecast for Q2 that underwhelmed Wall Street conscionable months aft it mislaid retired connected a bid for Warner Bros. Discovery (WBD).

On Thursday, Netflix reported Q1 net per stock of $1.23 connected gross of $12.25B, which compared to expert estimates of 77c and $12.17B, respectively. The institution said the Q1 EPS bushed was driven by operating income and a $2.8B termination interest related to the Warner Bros. transaction. Netflix guided to Q2 EPS of 78c connected gross of $12.57B, which compared to expert statement of 84c and $12.64B, respectively. The institution besides forecast FY26 gross of $50.7B-$51.7B, which compares to expert estimates of $51.38B. Additionally, Netflix announced that co-founder and president Reed Hastings volition not basal for re-election to the committee of directors.

Following the report, Barclays lowered the firm’s terms people connected Netflix to $110 from $115 and kept an Equal Weight standing connected the shares. The net banal absorption “points to the hazard with expectations acceptable up which whitethorn persist beyond the abbreviated term,” the expert said.

JPMorgan reiterated an Overweight standing connected Netflix with a $118 terms target. The steadfast recommended buying the shares connected the selloff. JPMorgan understands that immoderate investors volition beryllium disappointed with nary summation to the 2026 outlook contempt the Q1 upside. Netflix indicated that terms increases for the twelvemonth are already factored into the archetypal 2026 guidance for gross maturation of 12%-14%, the expert said. JPMorgan believes Netflix “continues to execute well, with sizeable maturation headroom.”

Meanwhile, Piper Sandler raised the firm’s terms people connected Netflix to $115 from $103 and keeps an Overweight standing connected the shares. The steadfast noted the institution reported an successful enactment Q1 2026 people with revenues and EBIT some 1% supra Piper’s estimates. Management reiterated 2026 guidance which sent the banal 10% little aft market. While results weren’t flashy, the steadfast said Netflix appears refocused connected the halfway with immoderate adjacent initiatives similar ads increasing well.