Last night, Netflix CEO Reed Hastings faced Wall Street with third quarter earnings which weren’t terrible in and of themselves. But he spooked investors with projected losses going into next year. The growth investors who remained in the stock started fleeing in after-hours trading, and this morning shares opened at $74.90, down 37 percent from a close of $119 yesterday.
That $44 drop translates into $2.3 billion worth of Netflix market cap getting wiped out in a single night. Netflix’s current market cap is just shy of $4 billion, down from more than $16 billion at its peak last July. LinkedIn, with a market cap of $8,6 billion, is now worth twice as much as Netflix.
Did Wall Street overreact? If you believe that streaming video is the future of movies and TV, this could be a buying opportunity.