Netflix (NASDAQ:NFLX) shares posted a strong gain in the final session before the Independence Day holiday, rising 4.66% to close at $77.65 on Thursday. Trading volume reached 55.54 million shares, approximately 134% of the stock's 65-day average, indicating robust investor interest. The stock traded in a range between $74.91 and $78.44 during the session.
U.S. markets were closed on Friday, July 4, for the holiday, and will resume regular trading on Monday. Netflix's Thursday close marks the end of a five-session winning streak, though the stock remains down 21.3% over the past three months and 40.1% lower than a year ago. The 52-week high stands at $129.50, while the low is $70.86.
Outperformance vs. Tech Peers
Netflix's Thursday rally significantly outpaced the broader tech sector. The stock outperformed the Invesco QQQ Trust (NASDAQ:QQQ), which tracks the Nasdaq-100, by approximately 6.4 percentage points. The QQQ fell 1.70% to $712.60, while the SPDR S&P 500 ETF (NYSEARCA:SPY) edged down 0.11% to $744.78. Benzinga noted that Netflix rose even as the Nasdaq-100 dropped over 2%.
Short interest remains relatively low at 101.03 million shares, representing 2.41% of the float, suggesting the rally was not driven by a short squeeze but rather by genuine buying interest.
M&A Speculation and Comcast Split
Market chatter around media consolidation intensified this week after Comcast (NASDAQ:CMCSA) announced plans to spin off NBCUniversal and Sky into a new public company. This move sparked speculation about potential acquisition targets, with some analysts suggesting Netflix could be interested in NBCUniversal's studio assets. Ross Benes, senior analyst at eMarketer, told Reuters that NBCU would eventually become an M&A target and that Netflix would likely have interest in the studio. However, Comcast CEO Brian Roberts dismissed the idea, stating "Absolutely not." Craig Moffett of MoffettNathanson also downplayed the likelihood of a Netflix-NBCU deal, noting that Netflix management has historically been rewarded for avoiding large media acquisitions and instead focusing on share buybacks and organic growth.
Earnings and Guidance on Deck
Investors are now looking ahead to Netflix's second-quarter earnings report, scheduled for release on July 16 after market close. The company has maintained its full-year 2026 revenue guidance of $50.7 billion to $51.7 billion, representing growth of 12% to 14%. The operating margin target remains at 31.5%, up from 29.5% in 2025. Netflix also expects ad revenue to reach approximately $3 billion in 2026, roughly double the prior year.
For the second quarter, Netflix forecasts revenue of $12.57 billion, up 13.5% year over year, and diluted EPS of $0.78, below the first quarter's $1.23. The company's Q1 2026 revenue came in at $12.25 billion, a 16.2% increase from a year ago.
Live Sports as Ad Revenue Driver
Netflix's push into live sports is expected to be a key factor in ad revenue growth. The company plans to stream a 2026 NFL Week 1 game in Australia, two games on Christmas Day, a Thanksgiving Eve game, a Week 18 matchup, and NFL Honors. These broadcasts will be available in over 200 countries, providing fixed-date ad slots that could significantly boost advertising income.
Following the earnings release, co-CEOs Ted Sarandos and Greg Peters, along with CFO Spence Neumann and Spencer Wang, will host a live video interview to discuss results and outlook.
