Netflix stock has taken a beating in recent months, down 42% from its all-time highs. For a company once seen as untouchable, the ongoing decline may be making investors nervous. Notably, Bill Ackman just built a new position in Netflix (NFX) through his hedge fund, Pershing Square Capital Management.
The stake, 3.15 million shares, now accounts for 4.9% of his portfolio. Is Netflix stock a bargain hiding in plain sight, or a classic value trap dressed up as a buying opportunity? Ackman's move is notable because of history.
He bought Netflix stock in early 2022 and sold three months later, reporting a loss of more than $400 million after the company reported its first subscriber decline in a decade. This time, his tone has flipped. In Pershing Square's mid-2026 investor letter, the firm wrote that Netflix has "effectively won the streaming wars." Related: Bill Ackman does U-turn on Netflix, makes bold claim Netflix now serves more than 325 million paid subscribers worldwide, nearly double its closest rival.
A bigger base means more money to spend on content while still protecting profit margins, as the financials show. According to the Q2 earnings call transcript: Netflix reported $12.4 billion in sales in Q2, an increase of 13.2% year over year. Growth has slowed a bit from the double-digit surges of the pandemic years, but it is still running at over 13%.
CFO Spence Neumann addressed the growth question directly on the Q2 2026 earnings call. He said Netflix expects 13% to 14% top-line growth for the full year, or roughly 12% on an FX-neutral basis, translating to about $6 billion of incremental revenue. He was clear the company does not manage quarter-to-quarter.
ServiceNow's quiet $1B cybersecurity boom A European rival to SpaceX is chasing a $2B valuation SK Hynix denies Intel Ohio fab deal, but the market didn't care "We're guiding to 12% revenue growth in Q3 reported, 11% FX neutral," Neumann said. "Halfway through the year, we're making strong progress against our goals, and we're tracking to our financial plan for 2026." Profitability is the more interesting story. Gross margin has climbed steadily, from 38.9% in 2020 to almost 52% in Q2.
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