Wall Street Lowers Netflix Stock Price Targets After Weak Outlook Overshadows Q3 Earnings

Wall Street analysts lowered Netflix's stock price targets following weaker guidance that overshadowed the company's Q3 earnings. Despite reporting stronger-than-expected third-quarter profit and revenue in line with expectations, Netflix projected a slower fourth-quarter revenue growth and lower ad sales for 2026. The company also cut 6% of its workforce and fired key executives, including Chief Content Officer Bela Bajaria and Film Chief Dan Lin, in its largest layoffs since 2022.

Analysts cited concerns about engagement growth and the company's focus on too many distractions. PP Foresight's Paolo Pescatore stated that Netflix needs to focus on compelling content and get back to basics after a year without a major breakout hit. UBS analyst John Hodulik maintained a buy rating but cut the price target from $115 to $110, highlighting Netflix's fundamental positioning and industry-leading scale.

Guggenheim's Michael Morris also maintained a buy rating but reduced the price target from $80 to $78, emphasizing the importance of an impactful content slate. Seaport Research's David Joyce cut the price target from $90 to $85 due to delayed gratification on advertising growth, while Jefferies' John Colantuoni kept a buy rating with a $85 price target.

Deutsche Bank's Bryan Kraft maintained a buy rating and $93 price target, believing the reaction was overly punitive. TD Cowen's John Blackledge agreed a long-term opportunity remains significant, particularly with new content chief Peter Rice's expertise. Netflix shares have declined 46% in the past year and 27% in the past six months.