Netflix's Big Change Was a Swing and Miss. Time to Sell the Stock?

As a last-ditch effort, some companies change their business models significantly to create a new growth wave. Netflix (NASDAQ: NFLX) recently tried this, and the results left a lot to be desired. In 2023, Netflix enacted two changes that challenged its long-term business model: An advertising tier and a password-sharing crackdown.

After investors got a glimpse of what the new Netflix looked like during its second-quarter earnings results, the changes didn't seem to have the effect the company was looking for. As a result, many investors are likely questioning if it is time to let Netflix shares go at this level. So let's look at how Netflix did and see if it's worth holding on to.

Netflix's revenue growth has been disappointing over the past year. It hasn't grown revenues by 10% or more in any of the four latest quarters, and Q2's 2.7% growth kept that shoddy streak alive. While management gave guidance indicating the business will improve in the third quarter (it guided for a 7.5% revenue increase), it's still not enough to push Netflix into market-beating growth territory.

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Source Fool.com