Netflix grew revenue faster than Amazon, Apple, Comcast and Disney over the past twelve months, yet its shares still finished the period down 38.9%. The company turned $48.37 billion in trailing-twelve-month revenue into a 29.7% operating margin, but investors sent the stock lower anyway.
That gap is why what is Netflix is being searched now: the company is still growing, still highly profitable and still trading at 24.9 times earnings, but the market has not rewarded it like Amazon, which traded at 20.1 times earnings and returned 7.0% over the same stretch. Netflix’s Q2 2026 report also carried another weaker-than-expected forecast, adding fresh pressure to a stock that was already 43% below its two-year high of $133.91.
On the numbers, the business remains strong. Netflix grew revenue 16.0% over the past twelve months, just ahead of Amazon’s 15.8%, and the company’s margin was wider than all of the comparables except Apple. For a streaming business, that combination matters because it shows growth without giving back much in profit. It also helps explain why management still argues the market is underestimating the runway ahead.
The CFO says Netflix is still below 45% penetration of roughly 800 million addressable households worldwide. That leaves room for much more revenue if the company keeps converting households at scale, and it is one reason management still guides 2026 revenue of about $51.20 billion, with full-year top-line growth of 13% to 14% and operating income growth of about 20.0%.
But the market is not paying for that future at full price. The stock’s 38.9% drop over the past twelve months shows investors are focusing less on what Netflix has already built and more on how fast it can keep expanding from here. A high margin and a premium valuation can coexist only while growth expectations stay strong, and the latest forecast hinted that those expectations may be cooling.
Netflix is not standing still. Live events are expected to take about 5% of the 2026 content budget while delivering 1% of view hours, and management says those events have produced six of the ten biggest new-member sign-up days of the past five years. The ads plan is also feeding advertising revenue guided to about $3.00 billion in 2026, while monthly players for the cloud games effort have risen elevenfold since Netflix scaled it up in October 2025.
The unresolved question is not whether Netflix is growing. It is whether the market’s reset reflects a temporary pause in momentum or a longer re-rating of the stock. For now, the answer is visible in the numbers: a business still expanding quickly, and a share price that says investors want even faster growth before they pay up again.
