It’s official… it’s the beginning of the end for Netflix (NFLX).
As you may have heard, the online video company made a troubling announcement…
This quarter, for the first time ever, it lost American subscribers. Hundreds of thousands of them.
The stock plunged more than 11% on the news.
I’ve been “sounding the alarm” on Netflix’s troubled business since last July when its stock was trading above $400.
It has fallen to $328 as I write this.
If you own Netflix stock or you’re tempted to go “bargain buying” here, please don’t.
There’s nothing but pain ahead for Netflix. Its stock is likely headed to $225 and dropping below $100 is a real possibility.
Netflix Is a Stock Market “Hall of Famer”
Since 2009, its business has grown, and grown, and grown. It has added roughly 140 million paying subscribers, and now it has more American subscribers than the top three cable companies… combined!
This relentless growth pushed Netflix stock to 8,500%+ gains since 2009.
But as I’ve been warning, Netflix’s string of growth is over. These latest results confirm it.
Not only did it lose American subscribers last quarter. It added only 2.7 million subscribers worldwide… less than half the number it added in the same quarter last year.
In his investor letter, CEO Reed Hastings explained the results: “Q2’s content slate drove less growth in paid ads than we anticipated.”
Hastings Just Admitted Netflix Is in Big Trouble
Reading between the lines, he’s saying: “We didn’t make enough good shows and movies… so we didn’t get enough new subscribers to sign up.”