Netflix concluded 2025 as a significant market laggard. The stock dropped approximately 20% during the fourth quarter, a stark contrast to gains posted by the S&P 500.
This downturn reflects waning investor confidence. The decline follows a disappointing October earnings report and continued uncertainty surrounding the proposed acquisition of Warner Bros. Discovery.
Investors are questioning Netflix’s ability to maintain its historical growth trajectory. Adding to future concerns, a recent report indicated the company could potentially lose over 100 original series and movies in 2026 due to the expiration of licensing agreements.
While the stock shows technical signs of being oversold, a meaningful recovery in the first quarter of 2026 depends on two factors. The company must gain clarity on the Warner Bros. acquisition and deliver a strong earnings report in January.