Netflix (NFLX) stocks slipped 0.2% lower in premarket trading on Tuesday as Wall Street scrutiny intensified ahead of the company's fiscal second-quarter earnings release scheduled for Thursday. Jay Woods, chief global strategist at Freedom Capital Markets, warned that shares could fall below $70 if the upcoming results disappoint. The streaming giant's stock has declined 41% over the past year amid investor concerns over slowing momentum, strategic uncertainty, and leadership changes.
Analyst Warning on Price Levels
Jay Woods, a New York Stock Exchange veteran, said Netflix shares could fall below the $70 mark if upcoming results disappoint. Woods warned that a move below $70 could expose the stock to a longer-term decline toward $57, while a recovery could push shares back toward the low $80 range before determining whether the rebound is sustainable. Woods said investors should monitor whether Netflix forms a potential reversal pattern or experiences a deeper breakdown.
Q1 Performance and Strategic Setbacks
Netflix delivered $12.25 billion in first-quarter revenue, up 16% from a year earlier. The company's outlook created uncertainty as management issued cautious margin expectations and maintained its revenue forecast. Reed Hastings' exit from Netflix's board created uncertainty around the company's leadership, while insider share sales worth nearly $130 million added to investor concerns. Investor confidence weakened after Netflix abandoned major acquisition pursuits involving Warner Bros. Discovery (WBD) assets and lost a competitive bid for Roku (ROKU).
Q2 Earnings Expectations
Netflix will report Q2 earnings on Thursday. Analysts project $12.58 billion in revenue and $0.79 per share in earnings, according to Fiscal AI data. Despite the stock decline, Netflix's cash flow remains strong. Analysts expect the company to deliver more than $50 billion in annual revenue in 2026, supported by its global subscriber base of more than 325 million paid memberships and strong free cash flow margins.
Technical Analysis and Price Targets
Analysts at Oppenheimer, KeyBanc, Citi and Bernstein lowered Netflix price targets due to valuation concerns, but maintained bullish ratings, citing long-term growth potential. Woods stated that investors should monitor whether Netflix forms a potential reversal pattern or experiences a deeper breakdown below the $70 level.
Retail Sentiment
On Stocktwits, retail sentiment around the stock remained in 'bullish' territory with a 224% rise in message volume in 24 hours. One user said, "enough is enough everyday down grade ,lower price target - hope next 3 days pre - er bull cycle !!!" Another user said, "want it to run into ER so bad. Such a tough zone to trade here. Massive iron condor opportunity but waiting for a run to 78 before setting the bear call spread." NFLX stock has crashed 21% year-to-date.
FAQ
What did Jay Woods say about Netflix stocks on Tuesday?
Jay Woods, chief global strategist at Freedom Capital Markets, warned that Netflix shares could fall below $70 if the company's Q2 earnings results disappoint. Woods stated that a move below $70 could expose the stock to a longer-term decline toward $57, while a recovery could push shares back toward the low $80 range.
When will Netflix report Q2 earnings?
Netflix will report its fiscal second-quarter earnings on Thursday. Analysts project $12.58 billion in revenue and $0.79 per share in earnings, according to Fiscal AI data.
