The stock was down 9.2% before the opening bell, extending its losses to more than 44% since reaching a record high in June 2025.

The latest forecast is the second straight quarter in which Netflix has guided below analysts’ estimates. Following the update, at least 11 analysts lowered their price targets for the company’s shares.

Although Netflix has expanded beyond its traditional subscription business, adding advertising, live programming and higher subscription prices to increase revenue per user, investors are still focused on whether it can continue attracting new subscribers.

Jeffrey Wlodarczak, an analyst at Pivotal Research Group, said subscriber growth remains the company’s biggest challenge as younger viewers spend more time on free social media platforms than on long-form streaming services.

“The story lacks excitement,” he said.

He added, “We believe this will result in slower subscriber growth and attempts by the company to offset this via more aggressive price increases and investment in content.”

Analysts also pointed to stronger competition from established streaming rivals such as Disney as well as YouTube, which continues to attract younger audiences with free video content.

Jefferies analysts said Netflix’s content line-up for the second half of 2026 is weaker than the one it offered a year earlier, which could make it harder to reassure investors.

Netflix has also reduced the amount of performance data it shares with the market. The company stopped publishing quarterly subscriber figures in 2025 and announced that, from January 2027, it will release its viewing-hours report once a year instead of twice.

Despite the recent decline, Netflix still trades at a premium compared with some of its biggest rivals. Its shares are valued at about 19.9 times expected earnings over the next 12 months, compared with 13.5 times for Disney and 6.6 times for Comcast.

With the decline, investors are currently concerned that Netflix may find it difficult to maintain the strong growth that once set it apart, especially as viewers have more entertainment choices and free online platforms continue to gain ground.

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