Why Netflix Stock Dipped Lower Today

• Netflix bushed estimates, delivering gross and net per stock maturation of 18% and 30%, respectively.

• Guidance for 2026 whitethorn person been a small lighter than the marketplace had hoped.

• Ultimately, Netflix's maturation optionality sets it isolated successful my eyes, arsenic it should supply years -- if not decades -- of continued growth.

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Leading planetary contented streamer Netflix (NASDAQ: NFLX) dipped 4% arsenic of 11 a.m. ET connected Wednesday aft the juggernaut reported mixed fourth-quarter net yesterday that narrowly bushed estimates. While the marketplace was hoping for blowout results, I deliberation Netflix's net were excellent. Fourth 4th gross grew 18%, remaining supra the company's annualized five-year mean of 14%. Earnings per stock spiked 30%. Free currency travel (FCF) roseate to $9.5 cardinal successful 2025 -- compared to income of $45 billion.

However, aft absorption offered blimpish guidance for 14% gross maturation and FCF of $6 cardinal successful 2026, the marketplace sent the banal somewhat lower, perchance owed to this softer outlook.

A fewer items from Netflix's Q4 net stood retired to me. While planetary full hours viewed lone roseate 2% (up from 1% past year), viewing clip for Netflix-branded originals roseate 9%. This beardown engagement with the company's ain contented continues to marque maine optimistic astir the imaginable Warner Bros. Discovery deal, arsenic it'd make a trove of contented and brands for Netflix to reimagine.

Second, absorption reported that advertizing income grew by implicit 150% successful 2025, albeit disconnected a somewhat tiny base, arsenic these operations launched successful precocious 2022. The institution expects this advertisement gross to treble to $3 cardinal successful 2026. If Netflix tin instrumentality the landing connected gathering its ain advertisement server, it could go an advertizing powerhouse akin to galore of its mega-cap tech peers.

Lastly, Netflix saw immense occurrence successful the world's astir populous state successful Q4. India was the company's second-largest contributor of paid nett adds and third-largest root of percent gross growth. This quality to accommodate to antithetic planetary markets whitethorn beryllium the astir important operator of the company's semipermanent maturation plans.

Trading astatine 26 times guardant earnings, pursuing its caller 38% decline, Netflix inactive offers intriguing potential, successful my opinion. As it leans into galore nascent maturation areas similar advertising, vertical videos, unrecorded events, caller geographies, gaming, podcasts, and a imaginable treasure trove of contented from WBD, Netflix's optionality looks reasonably priced today.