Netflix Stock Falls After CEO Nods To “Whole New World” Of Streaming Competition

Netflix stock retreated 6% in Friday trading after CEO Reed Hastings described a “whole new world” of streaming competition once Disney+ and Apple TV+ launch in the coming weeks.

“While weve been competing with many people in the last decade, its a whole new world starting in November,” Hastings said in an appearance at a Royal Television Society conference in Cambridge, England, according to multiple press reports. “Itll be tough competition. Direct-to-consumer [viewers] will have a lot of choice.”

Hastings tackled a range of topics, from programming budgets to the companys investment in UK studio space to his affinity for Fleabag, a show for which he said Netflix was “outbid” by Amazon.

In addition to Apple TV+, which goes live on November 1, and Disney+, which follows on November 12, NBCUniversal is launching Peacock and WarnerMedia is prepping HBO Max. Both will hit the market next spring. Amazon Prime Video and Disney-controlled Hulu are also retooling and making aggressive moves.

Netflix stock was at $268 as of mid-day Friday. It has dropped 10% over the past week and is now basically flat in 2019 to date. Shares had traded above $300 for much of the year but then dropped sharply in July after the company issued a weak second-quarter earnings report reflecting its first domestic subscriber decline in nearly a decade.

The comments by Hastings seemed to conflict somewhat with his previous positioning of streaming competition as a welcome development. The company has advanced the theory that the contest is not zero-sum and can have many winners. Todd Juenger, an analyst with Bernstein Research, issued a report to clients on Thursday embracing that notion and reaffirming his “outperform” (buy) rating and 12-month price target of $450 a share.

“The belief that new services will take market share from Netflix rests on an assumption that the services will compete with each other for a fixed number of potential subscribers. We dont believe thats true,” Juenger wrote. “We do not believe the launch of additional SVOD services wRead More – Source

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