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Justin Pope, The Motley Fool
Tue, July 21, 2026 astatine 4:35 AM CDT 4 min read
Shares of Netflix (NASDAQ: NFLX) precocious closed astatine approximely $69, putting the streaming elephantine down 26% successful 2026. The descent is portion of a longer and much achy 48% diminution implicit the past twelvemonth oregon so. Netflix has generated life-changing returns for investors, truthful it has a beardown estimation connected Wall Street and hasn't fallen this acold precise often successful the past decade.
But catching falling knives tin beryllium a unsafe game. What seems similar the eventual buying accidental tin easy punish overeager buyers. Here's what to marque of the institution aft its latest plunge pursuing its second-quarter net study merchandise past week.
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Wall Street is sounding the alarm connected slowing maturation
The marketplace saw Netflix arsenic a fast-growing darling for years. However, those days mightiness beryllium over. Netflix's gross maturation is abruptly slowing. Revenue grew by 17.6% successful the 4th fourth of 2025, followed by 16.2% successful the archetypal 4th of 2026, and 13.4% successful the 2nd quarter. Making matters worse, absorption guided for lone 11.7% maturation successful the existent quarter, yet different deceleration. Wall Street tends to stress quarterly performance, which is moving against Netflix astatine the moment, to beryllium sure.
That's not ever healthy, particularly for semipermanent investors. That said, Netflix's slowing maturation is decidedly becoming a trend. It's worthy considering the competitory scenery Netflix indispensable contend with, which includes video games and societal media, not conscionable different streaming services. Unfortunately, it's not yet wide whether this is simply a blip for Netflix oregon if the concern has peaked. Making that favoritism volition beryllium adjacent harder owed to Netflix's determination to connection little transparency into subscriber and viewership data.
Here's wherefore the selling mightiness beryllium overdone
Multiple things tin beryllium true. Netflix perfectly deserves a little valuation if its maturation is stalling. At the aforesaid time, the marketplace mightiness beryllium taking things excessively far. Even arsenic parts of the concern mature, Netflix could inactive person a precise agelong runway to monetize its users. The institution has delved into unrecorded sports implicit the past fewer years and is monetizing price-sensitive subscribers done ad-supported memberships.
It's besides worthy mentioning that Netflix hasn't had precise galore blockbuster hits recently. That's not ideal, but the adjacent Squid Game oregon KPop Demon Hunters sensation could abruptly reignite maturation astatine immoderate fixed moment.
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