Streaming giant Netflix saw its market value drop by an estimated $15 billion to $17 billion this week after billionaire Elon Musk urged his millions of social media followers to cancel their subscriptions. The call for a boycott, which Musk framed as being for the health of children, targeted what he and other critics have described as woke content on the platform .
The financial impact became clear as Netflix shares fell for several days in a row. The stock dropped more than 3% in one session, reaching a two-month low. By Thursday, the company's market capitalization had fallen to approximately $497 billion, down from a peak of nearly $570 billion in June . This decline occurred even as the broader S&P 500 index reached record highs, highlighting the specific pressure on Netflix .
The controversy started with a social media post about the animated children's series Dead End: Paranormal Park. The show, which features a transgender character, was accused by the account Libs of TikTok of pushing pro-transgender content on children. That post, made on September 29, gained over 26 million views and sparked the #CancelNetflix hashtag . Critics also alleged that the show's creator, Hamish Steele, had mocked the death of conservative activist Charlie Kirk. Steele has denied this allegation .
Elon Musk amplified the criticism on his social media platform, X, formerly known as Twitter. He reposted the content from Libs of TikTok and wrote, This is not OK. In a subsequent post, he directly told his 226 million followers to Cancel Netflix for the health of your kids . Musk confirmed he had canceled his own subscription and shared screenshots from other users showing they had done the same. One user commented that canceling was a form of fighting back, stating, This is what happens when you come after my kids .
The backlash quickly moved from online discussion to real-world financial consequences. Netflix shares fell 2.3% on Wednesday and dropped another 0.8% in pre-market trading on Thursday . Over three days, the company lost roughly $17 billion in market value . This event shows how quickly a social media campaign, when amplified by a high-profile figure, can affect investor confidence and a company's stock price .
Netflix has stated that its content catalog is designed to serve diverse audiences across different demographics . The company has not released a new public statement specifically addressing the recent boycott calls. This is not the first time Netflix has faced criticism over its content choices, but the direct link to a significant market loss is notable .
The stock decline comes at a critical time for Netflix. The company is scheduled to report its third-quarter earnings on October 21 . According to financial analysts, the company is projected to report revenue of $11.52 billion, which would be a 17.3% increase from the same period last year. Earnings per share are expected to rise 27.41% to $6.88 . Despite the recent drop, Netflix stock remains up by 29% since the start of the year, outperforming the S&P 500's 14% gain .
Beyond the immediate controversy, investors are watching several key parts of Netflix's business. The company's advertising-supported subscription tier has been a major growth driver, accounting for about half of all new sign-ups in countries where it is available . Netflix is also investing heavily in content, with plans to spend a record $18 billion this year on creating and licensing shows and movies. A growing part of that budget is going toward live sports and events, like the NFL games it streamed on Christmas Day, to attract and keep subscribers .
The company's partnership with AB InBev, announced in late September, shows a focus on growing its non-subscription revenue through advertising and brand integrations . However, some analysts caution that Netflix faces ongoing challenges. These include rising competition from other streaming services like Disney+ and Amazon Prime Video, the high cost of content creation, and market saturation in some regions . One analysis notes that Netflix's stock is trading at a high price-to-earnings ratio of 51.4, which is more expensive than the broader technology index .
The events of the past week show the new risks companies face in the age of social media. The direct line from an online post to a massive loss in market value shows how public perception and financial performance are now deeply intertwined. For Netflix, the immediate challenge is navigating the current backlash. Its longer-term task remains balancing content choices for a global audience with the demands of maintaining subscriber growth and investor confidence . All eyes will be on its next earnings report to see if the subscriber numbers have been significantly affected and how management addresses the situation.