1 Green Flag for Netflix, and 1 Red Flag
Competition in the streaming industry has increased significantly since 2019, lessening Netflix's (NASDAQ: NFLX) dominance in the market. As one of the industry's founders, the company held a vast majority of the U.S. market share for over a decade, responsible for 75% in March 2019. However, that figure has taken a deep dive in three years, with Netflix's majority market share at 26% in the U.S. in the second quarter of 2022.
Companies such as Disney, Apple, and Warner Bros. Discovery (NASDAQ: WBD) are threatening Netflix's spot at the top, evident by the company losing its first subscribers in a decade in Q1 2022. The loss led its stock to fall 62% year to date and has highlighted a red flag in its business: a lack of varied revenue streams. However, its brand has global recognition, which carries real power with consumers and could help it through the current slump.
Netflix was founded in 1997, starting as a mail-based DVD business. After 10 years of building its rental company into a $1 billion business, Netflix took a leap and launched one of the world's first streaming platforms. After another decade, in 2017, annual revenue reached a record $11.6 billion. In that time, Netflix became a globally recognizable brand, offering its services in over 190 countries. In 2022, Netflix's trailing sales have climbed to $31 billion.
Source Fool.com
