What's Wrong With Netflix Stock?
Yahoo Finance ·
It's hard to be a Netflix ( NFLX -2.69% ) investor right now. The streaming giant has a few bright spots in terms of growth, but the stock has declined more than 40% in the past 12 months and is just a few dollars off its 52-week low. So what's wrong with Netflix? The business itself isn't broken. Netflix reported a 13% increase in second-quarter revenue from the year prior at more than $12.6 billion. Operating margin and free cash flow slipped, but some of that can be attributed to tax payments the company owed for receiving $2.8 billion from Warner Bros. Discovery for the failed acquisition. The bigger issue for Netflix is twofold. First, competition is fierce in this space. In particular, YouTube is gaining traction and stealing market share, which worries analysts. YouTube is owned by Google, whose parent company is Alphabet .
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