Bloomberg Tech Netflix Shares Fall Despite Earnings Beat
Jul 18, 2025
Joe Zhao, Managing Partner at Millennia Capital and former Fed staffer, joins the discussion on the recent Netflix earnings that beat forecasts yet spurred a stock drop amidst heightened Wall Street expectations. They explore the challenges facing traditional media, the effect of AI on content creation, and how Federal Reserve policies shape venture capital investments. The conversation also touches on Taiwan Semiconductor Manufacturing's expansive plans amid industry shifts and the funding landscape for innovative defense startups.
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Netflix Beats but Stock Drops
- Netflix beat expectations in Q2, but the stock fell 5% due to very high market expectations.
- Investors seem cautious despite strong financials and a promising content slate.
Netflix’s Pragmatic AI Use
- Netflix views AI as a tool to improve content creation, not just to cut costs.
- They are using AI for production benefits like pre-visualization and visual effects.
Ad Tier Drives Netflix Growth
- Netflix’s ad-supported tier forms over 50% of new signups with strong retention.
- Monetization from ads is improving, supporting a longer-term growth story.