Key points:

• Netflix shares pop 5%
• Ackman renews subscription
• Investor booked a big loss in 2022

Pershing Square’s boss lost roughly $400 million fleeing Netflix in 2022. Four years and one badly bruised share price later, he’s pressing “Renew subscription.”

🍿 Ackman queues up the sequel

• Netflix shares NFLX surged 5.4% Thursday after Bill Ackman revealed a new position through Pershing Square.
• The exact stake wasn’t disclosed, but Netflix joined five other fresh investments as Ackman deployed nearly $5 billion following his US fund’s April listing.
• Ackman previously bought Netflix during its 2022 meltdown, then sold only three months later for a loss of roughly $400 million when subscriber weakness shattered his original thesis.
• The new position arrived after Netflix shares roughly halved from their 2025 peak. Ackman sees a dominant global platform, recurring subscription revenue, pricing power and growing free cash flow. In value-investor language, that means the business improved while the stock received an unscripted slap.

💰 Profits stream, engagement buffers

• Netflix generated $12.56 billion of second-quarter revenue, up 13% year over year, while net income rose 9% to $3.4 billion. Its 33.4% operating margin shows streaming can produce serious profits once competitors finish setting fire to several billion dollars annually.
• Management expects 2026 revenue between $51 billion and $51.4 billion, a 31.5% operating margin and approximately $12.5 billion of free cash flow — money remaining after operating and capital expenses.
• Advertising is the next promised growth engine, with Netflix targeting roughly $3 billion of ad revenue this year. But monetization has developed more slowly than analysts expected.

📺 The bull case needs more viewers

• Engagement remains the awkward subplot. Members watched more than 97 billion hours during the first half, only 2% above last year. Netflix argues viewing quality and monetization matter more than raw hours.
• Ackman is also attempting the comeback while his own funds trail badly. Pershing Square USA was down about 3.5% through July, versus a double-digit S&P 500 gain.
• Overall, Ackman’s return adds credibility but doesn’t remove execution risk. Watch advertising growth, engagement, price increases and the 31.5% margin target.
• A famous buyer can ignite the first candle; Netflix still needs earnings growth to keep your position from reaching the end credits.

Source: Tradingview