Netflix Stock Hits Record High Amid Strong Growth in Ad Tier and Subscriber Base

Netflix's stock has reached a new high, closing at $698.54—its highest level since December 2021—surpassing the previous peak of $691.69. This milestone follows a 1.5% rise in stock price after the company revealed a 150% year-on-year increase in upfront ad commitments, reflecting the strong performance of its newly introduced ad-supported subscription tier.

Shares have more than tripled since hitting a low in May 2022, bringing Netflix's stock close to its pre-pandemic peak. The company has outperformed its streaming rivals, with services like Disney+ down 56% from their 2021 highs, Max down 90%, and Paramount+ down 89%. Meanwhile, competitors like Peacock and Spotify are also seeing declines, but their Entertainment models differ significantly from Netflix's.

While Netflix has seen a remarkable rebound, its stock performance has still lagged behind the broader market. The S&P 500 has risen by 25% since December 2021, while Netflix's stock has increased just 1%. However, the company’s market capitalization now stands near $300 billion, surpassing competitors such as Disney, Paramount, Spotify, and Warner Bros. Discovery.

After a challenging 2022, where Netflix faced its first subscriber loss since 2011 and a significant drop in market value, the company has made a strong recovery. The success of the ad-supported tier, along with efforts to curb password sharing, has helped fuel subscriber growth. Netflix is now reporting record quarterly revenues of nearly $10 billion and has reached a new global subscriber count of 278 million.