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Netflix, diving 36%, wrestles with high penetration, advertising support

Apr. 20, 2022 11:49 AM ETNetflix, Inc. (NFLX)DIS, AMZN, CMCSA, WBD, APPS, MGNI, TTD, U, PUBM, APPBy: Jason Aycock, SA News Editor86 Comments

Entertainment Industry Workers Vote To Strike, Threatening Hollywood Productions

Mario Tama/Getty Images News

Netflix stock's (NASDAQ:NFLX) overnight trading action is landing hard on the stock Wednesday: It slid 30% out of the market open, its worst drop since 2011.

Shares are suffering even worse nearing midday Wednesday, down

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Comments (86)

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I know I'll be dropping NFLX once TMTG+ comes out.
Real world reality comes home to roost.
LittleMilk profile picture
RIP Joseph Carlson
What just happened is an excellent example of why I don't climb on the tech / social bandwagons. I have some idea what's going on with natural gas, and with shipping via container ships, that sort of thing, but I haven't a clue when it comes to what is going to happen in things like 'streaming'. So I maybe miss some big gains but I don't get surprised with 35% of my investment going away in a day.
testing an idea !!!
nerd_rage profile picture
@bull_rider The tl;dr version is that NFLX built their business by taking existing entertainment distribution systems and destroying them in favor of their own streaming system, which was great for customers but terrible for companies overall because the destroyed systems were more profitable.

But it's too late now! Whee. Now everyone has to live in the scorched earth that NFLX created. It could be that competitors are in better shape to do this, for two reasons: big global IP that allows for more efficient content spend (DIS/WBD/AMZN) or streaming is just an adjunct to support a real business (AMZN/AAPL). It's possible competitors will survive NFLX's scorched earth better than NFLX itself.
La Marque profile picture
@nerd_rage You are so full of BS. Blockbuster is gone for good reason and re-run ota TV is still with us (but it is on streaming FAST services). Netflix became popular for the fact that cable had huge holes in its content along with the fact that HBO and its ilk just added costs. The only thing that created your scorched earth is technology improvements of the internet and companies taking advantage.
JamesK101 profile picture
I think with D+ entering the fray this was expected. Amex Platinum just added D+ to the digital credits benefit, so I get $20 credit towards the D+ bundle. D+ bundle with Huly and ESPN+ has so much content that I will never ever watch it. D+ also has the gold mine of Star Wars which it will use to leverage the subscriptions.
khlim115 profile picture
@JamesK101 D+ is not immune to subscribers leaving. Soon or later, their content will get old and the audience will get tired of streaming.
badger1997 profile picture
@khlim115 I think Disney+ does a great job of stringing out their new content to keep people hooked. Once one new series ends, the next begins. Good strategy that has worked well for them so far.
Why_is_my_portfolio_red profile picture
is FANG now FAG?
After degenerating a generation of poorly parented young Americans...Reed reaps what he has sown.
Kisame profile picture
It seems these days I can get distracted quite a bit when I watch Netflix shows/dramas/movies. So I never completely watch from beginning to end - leaving shows haflway.

The only shows that i could recall watching uninterrupted was Pablo escobar el patron and El chapo.

Or either that i have a short attention span haha..
@Kisame watch ‘queen of south’
what nflx is wrestling with is mgmt with its head up its a$$. Management has been watching competition eating its lunch for over a year. Management has been too busy producing content that fits a certain political agenda rather than content appealing to all. Its watched innovation by others proven to goose other's returns while it steadfastly refused to adopt any of it. Management has sat around watching its company ripped off by sharing of login info. That's just to name a few of the bigger issues... Arrogant, politically active idiots, do this crap all the time thinking their mgmt position and/or past performance gives them license to fk shareholders for some greater good. Total BS. Avoid this like the plague.
@jeffk100 are you subscribed to netflix? if the answer is yes, log out, delete your Seeking Alpha Account, and move along

Then look in the mirror and actually put you money where your mouth (and hate) is so you can at least be a consistent person. If the answer is no, how would you know any of your claims if you can't watch any of it?
@jnewcomer90 thanks for your advice, but who the hell are you to tell people what they can say and where and what accounts they can have and not? typical bagholder who couldn't see it coming, i bet
@jeffk100 I'm not telling you, the logic is. But keep living your life according to alternative facts
buckiowa profile picture
My friend and I were talking about comedies. When is the last really funny comedy from Hollywood?

It’s been a long time !
@buckiowa People get offended too easily nowadays.

Can't laugh when you're too busy being mad.
nerd_rage profile picture
@buckiowa Series are funnier than movies now. Ted Lasso (AAPL), Fleabag (AMZN), The Righteous Gemstones and Barry (HBO Max). But NFLX is deficient in comedies.
DividendInvestorLA profile picture
Make bad movies and TV shows... go broke... It's that simple people!
@DividendInvestorLA they are not going broke…holy cow. Agree most content blows, but you are so wrong it’s scary. Major earnings beat and highly profitable.
DividendInvestorLA profile picture
@Total Returns Funny, people were telling me how wrong I was to say that the stock would crash... now it did... Netflix has been getting on on a meager broth of bad shows and huge promotional budgets... They ARE going broke. The only question is when if they don't start making good shows (and I doubt they're able to because it would mean having to hire people outside their circle of close friends...)
Robert Hennecke profile picture
WBD has decades of content that means not having to develop too many new shows...= profit and takeover potential.
DividendInvestorLA profile picture
@Robert Hennecke Not developing new shows is why Hollywood is dying ('id argue it's creatively dead).
Buying wbd…a lot. Do you think the streaming pie is shrinking? Or do you think Netflix is maybe getting some real competition? The only problem for wbd is that their richly valued competition (whose multiple they aspired to achieve) has come way down. Still, wbd is actually a really good service and they will thrive (imho) with their new leadership.

Funny how people think this has to do with being woke lol.
DividendInvestorLA profile picture
@Total Returns As long as they all make horrid content, they'll all keep losing money.
@DividendInvestorLA losing money? Who is losing money?
@Total Returns Anyone who bought yesterday
LONGBULL+ profile picture
Guess Netflix no longer has that outstanding Quality in Content compared to Disney WBD. They also are now willing to think about advertising.
To add an advertise angle to Netflix and more content PERHAPS merging with PARA COULD be a solution#
DividendInvestorLA profile picture
@LONGBULLPLUS They NEVER had outstanding content. They had a great marketing effort backed by their supposed competition that genuflected because they had access to Billions of Dollars of bank loans.

Now the shitty product is hitting the (former) fan(s).
High Yield FIREVestor profile picture
ROKU down too. Man, this subscription service here on SA called Potential Multibaggers: what a joke of a service! They charge, and with growth stocks suffering only ppl making money from that service is those guys collecting the fees! So glad I dumped that joke service after one month! They promoted ROKU, NET, PAYCOM, among other joke stocks! Potential Multibaggers? LMAO 🤣
@FirstFIREWealth potential multibag losers maybe they meant?
@jeffk100 now you’re speaking my language 😂
Mr. Gumbo profile picture
Get woke, go broke
Jacobin777 profile picture
@Mr. Gumbo
"Definition of woke (Entry 1 of 2)

chiefly US slang
: aware of and actively attentive to important facts and issues (especially issues of racial and social justice)"


So I guess its ok society shouldn't be paying attention to issues of racial and social injustices.

Is that what you are saying? Is that what you want? Are you saying its NOT ok to be aware of racial and social injustice?
@Mr. Gumbo This is the correct take. If you're steeped in the world of DEQ, wokeness or are purient, you're pretty satisfied with NFLX. But there's a massive underserved audience out there as Costner demonstrated with Yellowstone.
@Jacobin777 The company is ideologically blinkered. To them, releasing "Cuties" is a good idea, but anything remotely interesting to 35-45% of the US population is a cardinal sin.
20 Apr. 2022
$NFLX needs to hire more diversity and inclusion VPs
Non-GAAP Earnings profile picture
Bridgerton is a politically-correct re-writing of history. Before 1960, the nonwhite population of the UK, and indeed Europe as a whole, was statistically zero. The long-term goal that these leftists have is to rewrite history such that we think that it’s perfectly normal today for Europe to be flooded with mass immigration from the third world.
khlim115 profile picture
The problem that NFLX faces will hit all streaming services. Once everyone starts to lose subscribers, NFLX will rise again. I am staying away while the entire industry remodels and re-prices the streaming enterprise but will put my money to work once the dust settles. If anyone knows of a streaming service that is gaining subscribers in this environment, let me know.
DividendInvestorLA profile picture
@khlim115 The problem is the crappy product, and it's something you can't cure with slogans and PR releases.

Sadly Hollywood has kicked out two generations of talented creators to make space for their families and lovers. The result is the crappy product that is tanking it.
RSI Raistlin profile picture
@khlim115 Where do you think the eyeballs go. They are leaving NFLX because its tired. They are moving to other streamers with far better content period.
khlim115 profile picture
@RSI Raistlin -- such as? Even if other sites win the "eyeballs" for now, soon the viewers will get tired of those contents and will start to abandon them as well. Besides, no one has the international presence the way NFLX does.
solamarv profile picture
Netflix should focus on high quality and less quantity. There are TONS of Netflix originals, but even the ones that seem interesting turn out to be turds. I know they are capable of it.

Also, quietly turn on the subs in Russia (assuming they haven't already, which is likely). You made your stand, now make your money.
@solamarv They still haven't topped the "Narcos" since it came out.
Another Mountain's Rock Investing profile picture
@TunnelUnderTokyo narcos and the crown was/is good. Not much else that you can't see elsewhere. Like peaky blinders.
@another Mountain's Rock Investing C'mon, Wagner Moura was incredible in the role, and probably etched forever in the television as his character.

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