Netflix Boycott: Will Elon Musk’s Call Impact Indian Investors?
Netflix extended its losing streak in pre-market trading on Thursday, dropping 0.8% to a two-month low of $1,162 per share on Nasdaq, following a 2.3% decline in the previous session. The slump came on a day when the S&P 500 notched a record close above 6,700.
Why is the Stock Under Pressure?
Netflix shares came under pressure after billionaire Elon Musk urged users on his platform X (formerly Twitter) to cancel their subscriptions following the cancellation of his account. The call came in response to controversy around the animated series Dead End: Paranormal Park, which features a transgender character.
Controversy Around Dead End: Paranormal Park
The backlash was triggered by a post from the account Libs of TikTok, which accused the show of “pushing pro-transgender [content] on CHILDREN.” The post, made on September 29, has since garnered over 26 million views, Hindustan Times reported.
Elon Musk’s Involvement
Musk amplified the criticism by reposting the Libs of TikTok content and writing, “This is not OK,” followed by, “Cancel Netflix for the health of your kids.” When a user commented that they had canceled their subscription, Musk replied, “Same.”
Impact on Indian Investors
But will this boycott call impact Indian investors? Historically, such boycotts have had minimal long-term impact on Netflix’s subscriber base. However, the company has faced criticism in recent years from conservative groups over content decisions.
Netflix’s Response
Netflix has maintained that its catalog is designed to serve diverse audiences across demographics. The company has also faced criticism for seemingly taking stances on social issues like Black Lives Matter but avoiding other sensitive topics.
Market Impact
Netflix shares fell over 3% in the last trading session, eroding $17 billion in market value and bringing the company’s market cap down to $497.17 billion at Wednesday’s close. However, the shares are still up 29% year-to-date, well ahead of the S&P 500’s 14% gain.
What Indian Investors Should Know
Indian investors should be aware of the potential risks and opportunities associated with investing in US markets. While the boycott call may have a short-term impact on Netflix’s stock price, it is essential to consider the company’s long-term prospects and fundamentals.
For more information on investing in US markets, check out our guide to investing in US markets. You can also stay updated with the latest stock market news and analysis.
