Netflix Inc. (NASDAQ:NFLX) stock traded lower on Monday as structural headwinds from its second-quarter guidance continued to depress the share price. The decline comes despite a brief lift last Thursday following disclosures from Pershing Square Capital Management.
The Nasdaq is up 0.14% while the S&P 500 has shed 0.15% and Communication Services is down 0.7%.
• Netflix stock is facing resistance. Why is NFLX stock retreating?
Pershing Square Discloses New Position
Billionaire investor Bill Ackman re-entered Netflix, acquiring 3.15 million shares. The new position makes up 4.9% of Pershing Square’s portfolio. Ackman previously exited Netflix in 2022 with a $400 million loss after purchasing over $1 billion in stock at $400 per share and selling at $225 per share.
Pershing Square stated that “Netflix has since effectively won the streaming wars” and noted the stock’s “current valuation multiple represents a substantial discount.”
Second-Quarter Revenue Misses Estimates
On July 16, Netflix reported second-quarter revenue of $12.56 billion, missing the Street consensus estimate of $12.59 billion despite rising 13% year-over-year. UCAN revenue hit $5.43 billion (+10%), EMEA reached $4.03 billion (+14%), LATAM generated $1.58 billion (+21%) and APAC totaled $1.51 billion (+16%).
Earnings per share came in at 80 cents, beating the Street estimate of 79 cents. View hours grew 2% year-over-year in the first half of 2026. Live programming accounted for 5% of 2026 content spend and 1% of view hours, while ad-related revenue remains on track to top $3 billion for 2026.
Soft Guidance Triggers Pressure
Market sentiment remains tied to conservative forward guidance. Netflix projects third-quarter revenue of $12.86 billion (12% year-over-year growth), falling below Street estimates of $13.01 billion.
Expected third-quarter earnings of 82 cents per share also lag behind the Street consensus of 84 cents. Additionally, Netflix narrowed its full-year revenue outlook to $51 billion–$51.40 billion from $50.70 billion–$51.70 billion, compared to the Street estimate of $51.41 billion.
NetFlix Technical Levels to Watch
From a trend perspective, Netflix is trying to stabilize in the short term, trading above its 20-day SMA ($73.25) and 50-day SMA ($74.75), but it remains 7.9% below its 100-day SMA ($83.54) and 13.6% below its 200-day SMA ($89.04). That "short-term bounce inside a longer-term downtrend" setup often creates choppy tape, especially with the 20-day SMA still below the 50-day SMA (a bearish alignment).
- Key Resistance: $78.50
- Key Support: $71
NFLX Stock Price Activity: Netflix shares were down 2.14% at $76.49 at the time of publication on Monday, according to Benzinga Pro data.
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