Reasons Why Offers Should Not Invest In NFLX

Netflix, which was a start-up company in the streaming services industry till it became a global example to the other companies in the same industry, was founded in 1997 by Reed Hastings and Marc Randolph. Subsequently, the platform Netflix (NFLX) has strived to build an ongoing connection with consumers by connecting with them and customizing their preferences of shows using past information by asking them what they typically prefer to watch. NFLX is now available in more than 190 countries with approximately 230 million subscribers. The purpose of this report is to call attention to the reasons why investors should not consider investing in Netflix and target long-term investors or those who lack experience in NFLX and may consider

With Netflix being the first platform to specialize in streaming services, a large number of companies headed toward filming and producing series since it was a promising industry, such as Apple, Hulu, and Amazon. Each company offers different content and price with a unique design. With different companies to choose from, numerous consumers have needed help choosing which platform is appropriate for them. Consequently, Netflix stocks have decreased each time a new company appears with a lower price in the streaming service industry. According to Ashcroft (2023), North America and Europe consumers have begun to complain about subscription fatigue because of having approximately 200 streaming platforms available. This indicates that numerous consumers need clarification about which platform they have to subscribe to it, which is likely to affect Netflix stocks. In fact, between January and September of 2022, almost 940,000 homes in the U.K. having at least one streaming subscription canceled their subscription (Ashcroft, 2023). This implies that investors are likely to lose their money due to the competition between the different

The process of producing a show is complex since numerous things need to be done, such as waiting for the writers to provide a great storyline, selecting actors, and filming. These take a long time which led Netflix to buy rights for shows from the producing companies to satisfy their subscribers' needs. After a specific time, the companies retrieve their rights. This led Netflix to remove the shows. Numerous subscribers prefer watching their favorite show on the original platform rather than subscribing to Netflix, knowing that the show will mostly be deleted. According to Figure 1, with the release of the series Stranger Things season 4 in 2022, the number of subscribers on Netflix reached over 200 million (Sherman & Clayton, 2022). This suggests that numerous people may cancel their subscriptions due to the lack of offering original content. In fact, according to Levy (2023), approximately 40 of Netflix's top 100 titles were original in 2022, with roughly half its budget going toward original content. This implies that Netflix may continue to experience difficulties in making original content, negatively affecting investors'