Netflix shares fell 10% after issuing second-quarter guidance that missed key Wall Street estimates. The company projected Q2 revenue of $12.57 billion and earnings per share of $0.78, below analyst expectations. A slower stock repurchase pace of $1.3 billion in Q1, compared to its 2025 average, further concerned investors. Despite the guidance miss, Q1 2026 results exceeded forecasts, with revenue of $12.25 billion and adjusted EPS of $1.23. Wall Street maintains a positive median price target of $115 for NFLX stock.
Netflix provided second-quarter revenue and earnings guidance that fell short of Wall Street estimates, leading to a 10% drop in its share price. The company expects Q2 revenue of $12.57 billion and earnings per share of $0.78.
Its operating income outlook of $4.11 billion also missed the anticipated $4.34 billion. Investor concerns were compounded by a slower pace of stock repurchases in the first quarter.
The company repurchased $1.3 billion of its stock, below its $2.3 billion quarterly average in 2025. Co-CEO Greg Peters addressed these concerns “Of course, it’s early in the year. There’s still plenty of time to go, plenty of work left to go do.”
Peters added, “We’ve seen really good progress so far in this first quarter that builds on the solid momentum and results from 2025.” Executives stated there are no changes to its capital allocation program.
About $6.8 billion remains for repurchase under Netflix’s authorization. Its first-quarter 2026 performance actually exceeded analyst expectations.
Netflix reported Q1 revenue of $12.25 billion, compared with an estimate of $12.17 billion per Bloomberg consensus data. Adjusted earnings per share came in at $1.23, significantly above estimates of $0.76.
Wall Street analysts maintain positive forecasts for the stock despite its recent decline. The median price target for Netflix (NFLX) is $115, implying a 19% climb.
Most analysts hold positive ratings, including Outperform from Oppenheimer and Buy from Guggenheim. Bernstein offers a significantly higher price target of $139.
