Netflix and Spotify Experience Significant Stock Declines
Both Netflix (NASDAQ: NFLX) and Spotify (NYSE: SPOT) have seen their stock prices drop between 25% and 30% since midyear 2025, largely due to disappointing earnings results and weakened outlooks. This decline follows poor financial reports wherein Spotify reported a negative earnings per share and announced CEO Daniel Ek’s resignation, while Netflix attributed its strong financials to currency improvements rather than increased consumer engagement.
As of late 2025, Netflix trades at less than 30 times analysts’ estimates for its 2026 earnings, while Spotify is valued closer to 50 times. Analysts predict strong earnings growth for Spotify, but its high valuation may lead to volatility if estimates are revised downwards. In contrast, Netflix’s more predictable revenue model allows it to manage content costs effectively, making it a potentially stronger investment heading into 2026.
