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- 💰 Netflix Tanks Post Q4 Results
💰 Netflix Tanks Post Q4 Results
PLUS: Trump drives the market lower
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Market Performance
The major indices suffered significant losses on Tuesday as geopolitical tensions intensified:
S&P 500: 6,796.86 ⬇️ 2.06%
Nasdaq: 22,954.32 ⬇️ 2.39%
Dow Jones: 48,488.59 ⬇️ 1.76%
Netflix's Mixed Results Amid Major Acquisition Push
Netflix (NFLX) hit a major milestone on Tuesday, reaching 325 million global paid subscribers—its first membership disclosure in a year.
The streaming giant reported Q4 earnings of $0.56 per share (beating the $0.55 per share estimate) on revenue of $12.05 billion (versus $11.97 billion expected).
Net income climbed to $2.42 billion, up from $1.87 billion year-over-year.
The real story, however, is Netflix's advertising ambitions.
Ad revenue more than doubled in 2025 to over $1.5 billion, and the company projects another doubling in 2026.
Revenue guidance for the year ranges between $50.7 billion and $51.7 billion.
Yet the market wasn't impressed—shares dropped over 4% in after-hours trading. Why? Netflix's growth fell short of ambitious internal targets leaked in an April Wall Street Journal report, though co-CEO Greg Peters dismissed these as "long-term aspirations."
The elephant in the room remains Netflix's shocking $72 billion all-cash acquisition of Warner Bros. Discovery's streaming and studio assets, including HBO Max.
Netflix amended its offer to all-cash on Tuesday and paused share buybacks to fund the deal. Since acquisition rumors surfaced in October, Netflix stock has plummeted nearly 30%.
The deal faces serious headwinds: Paramount Skydance launched a hostile counterbid, and regulators are scrutinizing whether the combination violates antitrust laws.
Co-CEO Ted Sarandos defended the merger as "pro-consumer" and "pro-innovation," arguing it would preserve jobs and expand content creation rather than consolidate it.
Netflix stock has a Ziggma score of 100, ranking higher than peers in valuation, profitability, and financial health.
Our Takeaway
Netflix is betting big that scale wins in streaming's brutal competition. But at what cost? The Warner Bros. acquisition transforms Netflix from a tech-forward disruptor into a traditional media conglomerate—exactly what it spent years avoiding.
While the strategic logic is sound (HBO's prestige content plus Warner's IP library), execution risks are enormous.
Regulatory approval is uncertain, integration challenges loom, and the market clearly questions whether Netflix overpaid.
The company's ability to double ad revenue while navigating this massive M&A will define its next chapter.
➡️ NEW: Original Ziggma Research on Substack: Is Microsoft the Best Long-Term AI Play - For Shareholders and the Climate? 🔖 Read or 🎧 listen to podcast.
Market Overview 📈
U.S. markets cratered on Tuesday as President Trump escalated his rhetoric on acquiring Greenland, threatening tariffs on eight NATO allies who oppose the deal.
Starting at 10% on February 1 and rising to 25% by June 1, these tariffs represent a weaponization of trade policy for non-economic goals—rattling investors already concerned about "priced for perfection" valuations.
Treasury yields spiked dramatically—the 10-year hit 4.299%, its highest since September, while the 30-year climbed to levels not seen since 2023.
In a symbolic move, Danish pension fund AkademikerPension announced it was exiting $100 million in U.S. Treasurys, citing fiscal concerns over America's debt trajectory.
The VIX fear gauge surged to 20.99 as the "sell America" trade gained momentum. The U.S. Dollar Index fell nearly 1%, while the euro jumped 0.8% against the greenback.
European markets responded with their own selloff, with France's FR40 down 1.8% and Germany's DAX off 1.2%.
European leaders called Trump's threats "unacceptable" and are reportedly considering the EU's "Anti-Coercion Instrument"—its strongest economic counter-weapon.
As Ray Dalio warned from Davos: "On the other side of trade deficits and trade wars, there are capital and capital wars."
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Stock Moves Deciphered 📈
💾 SanDisk (SNDK)
SanDisk surged 9.5% on January 20, reaching new all-time highs. The rally was driven by exceptional quarterly results and robust guidance that crushed analyst expectations.
The company is capitalizing on the explosive demand for AI infrastructure, as data centers require massive storage capacity for training large language models and processing workloads.
⛏️ Albemarle (ALB)
Albemarle shares jumped 5.8% following an upgrade from HSBC analysts who see a turning point for lithium prices in 2026.
While the company expects to post losses in 2025 due to the prolonged lithium price downturn, analysts project a significant earnings rebound as electric vehicle demand accelerates and lithium supply and demand rebalance.
👑 Newmont (NEM)
Newmont shares gained 3.73% as gold prices surged to all-time highs amid intensifying geopolitical tensions over Greenland and Trump's tariff threats.
Investors fled to traditional safe-haven assets, driving gold to new highs as concerns mounted about global trade wars and U.S. fiscal sustainability.
Multiple Wall Street analysts upgraded Newmont, with UBS raising its price target based on higher long-term gold price assumptions.
Headlines You Can't Miss 👀
📊 Goldman Sachs upgraded On Holding to buy from neutral with a $59 price target, citing 23% upside potential and expecting >20% revenue growth through 2028.
🛡️ Stifel raised nLight's price target to $60, betting on directed energy weapons becoming critical military technology following the Pentagon's prioritization announcement.
💰 Citi maintained S&P 500 target of 7,700 (11% upside), with strategist Scott Chronert calling Tuesday's selloff a buying opportunity despite macro headwinds.
🏦 Danish pension AkademikerPension exited $100M in U.S. Treasurys, citing concerns over America's fiscal position amid Trump's escalating geopolitical tensions.
⚡ Bitcoin fell 3% to $90,047 while gold surged 3%, undermining cryptocurrency's "digital gold" safe-haven narrative during geopolitical stress.
🏪 Walmart hit new all-time highs, rising 1%, demonstrating defensive strength as value retailers outperformed amid the broader market selloff.
🔬 RBC upgraded Solstice Advanced Materials to outperform with a $75 target, highlighting the company's edge in environmentally friendly HFO refrigerants post-Honeywell spinoff.
📈 The Russell 2000 outperformed the S&P 500 for the 12th consecutive day, its longest streak since June 2008, as domestic-focused small caps proved more resilient to trade tensions.
Trending Stocks 📊
🏭 3M (MMM)
3M plummeted 7%, marking one of the S&P 500's worst performers after the industrial conglomerate issued disappointing 2026 earnings guidance that fell well short of analyst expectations.
The company projected earnings per share significantly below consensus estimates, signaling weaker-than-expected demand across its diversified product portfolio spanning industrial, safety, healthcare, and consumer segments.
🤖 Nvidia (NVDA)
Nvidia fell 4.4% as investors trimmed positions in the AI chipmaker amid escalating global trade tensions.
Despite the pullback, Nvidia remains the cornerstone of AI infrastructure buildout, with its Blackwell GPU platform driving unprecedented demand from cloud providers and enterprises deploying generative AI applications.
📈 Micron Technology (MU)
Micron shares rose marginally after announcing a letter of intent to acquire Powerchip Semiconductor Manufacturing Corporation's fab in Taiwan for $1.8 billion in cash.
The acquisition expands Micron's manufacturing footprint in Taiwan, providing additional capacity to meet surging memory chip demand driven by AI workloads and data center expansion.
What’s Next?
Key market and macro news 👇
🎤 As a technology bellwether, IBM's quarterly results, expected around this time, will offer insights into business spending on software, consulting, and cloud services, which will influence the broader tech sector.
✈️ United Airlines’ earnings and forward-looking statements will provide a crucial indicator of travel demand, fuel costs, and the overall health of the transportation sector and consumer spending.
🏦 The detailed record of the Federal Open Market Committee's last meeting could be released, providing clues about the Federal Reserve's future interest rate policy and economic outlook.
🏡 The release of existing home sales data for the previous month will offer a snapshot of the housing market's strength, impacting construction, lending, and consumer wealth perceptions.
📊 The release of the latest CPI figures will be closely watched for signs of inflation, which could influence the Federal Reserve's monetary policy and impact corporate profit margins.
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