Why Are Stocks Plunging 35%?  / Technology Headlines

Why Are Stocks Plunging 35%? / Technology Headlines

That actions of Netflix They are suffering from the negative results that the company’s balance sheet showed on Tuesday.

Fact that after the daily closing time that day in the after-market where was proven plummeted by more than 25%. And thereby Wednesdaythe collapse is bigger because dropped over 35 percent.

And since the balance was known, the The company lost about $54 billion in value Market.

Why Are Netflix Stocks Falling?

According to the streaming company, in the first quarter of the year I lost 200,000 subscribersand was below forecasts by the company, which wanted to increase accounts to 2.5 million.

The brand itself, with the letter “N” in red, has also recognized this Pandemic “clouds” your business vision.

“It turns out the first time in a decadethat the audiovisual content company a Decrease in subscriber numbers«It says Damian VlassichIOL research analyst invested online.

In addition, it details that Netflix reported this expect to lose APPROX 2 million users worldwide this quarter.

“This responds to a context of increased competitionthe increasing use of shared accounts and the difficulty of increasing the number of subscribers in some specific markets,” Vlassich states.

Netflix lost about 200,000 subscribers in the first quarter, and shares plunged more than 36% after the data was released.

Added to this is the decision of the company Close the service in Russia, as a result of the invasion of this country in Ukraine. An action that generates a loss of 700,000 subscribers.

In addition, Netflix also reported that the Sales growth has slowed significant.

“Therefore, Gains made mainly during the pandemic hid some of them flaws in the business model Classic warns.

In the company’s own words: “The Covid has clouded our vision significantly increase our sales in 2020”.

Netflix numbers that alarm investors

The spread of Netflix action So the US market closed Tuesday, ending the day up 3%, placing $348.61 worth of each stock.

Yes, if you know the negative data that the company has thrown in convenience store the papers began collapses by more than 25%, to quote $260. Namely, Depreciation of more than $88 per share.

And in the open wheel of east Wednesday the collapse reached exceed 36%then the share price of Netflix They stopped just above $222 at one point The drop for the entire day was 35% to close at $226. A loss of $122 per share since the news broke..

A fact that isn’t presented as “new” as the company’s stock also fell 25% earlier in the year after a drop in subscriber numbers.

Netflix shares lost about $88 in value in a matter of hours after negative balance sheet data.

Netflix shares lost about $122 in value in a matter of hours after negative balance sheet data.

It should be remembered that before this financial news came out, the market value of this company was $154,878 million and now it has increased to $100,490 million. A Lost $54,000 million in less than 24 hours.

“Despite the negative aspects reported, it is worth noting that the Earnings per reported share were $3.53, which significantly beat the market consensus, which was expecting $2.89, but reflected a decline of approximately 6% compared to what was reported in the first quarter of 2021,” Vlassich reflects.

Finally, this expert adds that the Netflix’s revenue was $7.87 billionthat “although it represents a a growth of almost 10% year-on-year, is below market expectations.”-

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#Why #stocks #collapse
Source: iprofessional.com