Stock Market Update

[BRIEFING.COM] The major averages continue to steadily chart session highs, which in the case of the S&P 500 and Nasdaq Composite, are all-time highs.

Netflix (NFLX 98.67, -9.12, -8.46%) is missing out on today's rally following its Q1 report, as a strong headline EPS beat was overshadowed by disappointing Q2 guidance and questions around the quality of the earnings upside. Revenue grew 16.2% year-over-year (+14% CC) to a record $12.25 billion, topping expectations, while the company reaffirmed its FY26 revenue outlook of $50.70-51.70 billion and operating margin guidance of 31.5%.

Netflix delivered a headline-grabbing EPS beat, but the market is looking through much of that upside given it was primarily driven by a one-time $2.8 billion termination fee rather than core operations. The bigger issue is the softer-than-expected Q2 guidance, particularly the year-over-year decline in operating margin tied to elevated content amortization. While management is confident margins will improve in the back half of FY26, investors appear hesitant to give full credit until that inflection materializes. Additionally, the stock had a strong run into the print, climbing from the mid-$70s to around $108, leaving little room for disappointment.