Netflix stock has fallen roughly 25% since FQ1 2026 earnings on April 17, even though Netflix posted stronger-than-expected revenue for the quarter. The selloff reflects how quickly investors turned from the results themselves to what management said about the year ahead.
That move matters now because the market is still weighing whether Netflix can keep growing fast enough to support its valuation. Shares closed on a quarter in which the company reported $12.25 billion in revenue, ahead of the expected $12.17 billion, and EPS of $1.23, yet the stock still came under pressure after the release.
Management kept full-year 2026 revenue growth guidance at 12% to 14% and left operating margin guidance at 31.5%, numbers that may look solid on paper but were not enough to calm Wall Street. The average 12-month price target points to more than 41% upside from current levels, and Bernstein SocGen Group reiterated an Outperform rating on June 4 with a $110 target, showing that the long view remains constructive even after the sharp drop.
The problem is that the quarter’s beat did not change the narrow focus on the company’s outlook. Netflix still holds 5% of global TV viewership share and remains underpenetrated in non-Anglophone markets, which means the growth story depends on continuing to widen the audience while accelerating advertising and live sports. That is exactly where investors want more proof, not just steady guidance.
For shareholders, the next question is not whether Netflix can produce another quarter with solid revenue. It is whether the company can turn that 12% to 14% growth path into something that looks less cautious before the market keeps treating good results as the floor and the outlook as the test.
