NFLX is maturing into a value stock, not a tech growth story: revenue growth slows from 16% in 2025 to an expected 13% in 2026, but at under 20 times forward earnings with rising margins it looks like a good value now; ad concerns may be exaggerated. It is not assured; no rush, and its story is less clear than peers.

I want to start with Netflix. This is an arrow that has been around in the world of " Motley Fool" for a long time. Many investors may have made huge profits here, but their last quarter wasn't exactly what investors were looking for.

The stock is down by only about 3% as we record early on Wednesday. Lou, this looks like one of those quarters with double- digit revenue growth. I think their profit margins were slightly better than they expected.

But the market was rather lukewarm. Is this the mature stage that Netflix has reached now?

I think that's exactly the situation. Look, yes, revenues are growing, but at a slower pace. There isn't much good news about the level of engagement. As you know, people aren't really excited about coming to Netflix.

The slowdown in advertising sales is something I think is a really interesting surprise.

Look, Netflix is the same as it is now. I was having this conversation with someone , an investor, yesterday, about how it's been a long time since we got excited about anything we found on Netflix.

It is a mature company. She is doing very well. We are in an age of gradual evolution where things that used to amaze us are no longer so. I think this quarter was rather boring.

It was more like a yawn. So, perhaps the market is right this time.

Yes, John, slowing growth is always something investors don't want to hear about. They also got rid of their head of content . So, they seem to be aware of that, and there were many questions in the conference call about this interaction.

I don't know exactly which scale you want to use.

They wanted to turn it into: "Hey, you know what? We can raise prices if we want . So, we can raise them. It must be pretty good ." But they acknowledge that the content may not be convincing enough.

certainly. Lou has already touched on that. I think this puts a finger on the wound. I don't think you're raising prices when you're struggling with content. I don't think this is the right step, and I think that's why they haven't done it yet .

Normally, no one penalizes a stock because of the quarter it just announced. Normally, what worries investors is the upcoming quarters. This seems to be the case here. I have already touched on some points.

I just want to focus more on the advertising element. This is supposed to be Netflix's golden goose, and perhaps it still is, but there are concerns that are beginning to surface beneath the surface.

In general, when it comes to digital advertising, is this something that will be disrupted, leading Netflix to say, " We are actually delivering slightly less of our projections for this year than we would have liked"?

But if I could calm those fears a little. If digital advertising is to continue anywhere in the market with AI agent dominating, I would say that content business is one of the places where it will continue , because it is a place where humans still interact with the platform. This is good for Netflix in the long run.

And I would like to add something else, which is that Netflix does not say this is a demand problem. It's a matter of timing when the product is released. Therefore, I believe that the revenues that were expected this year, and perhaps are no longer, will come a little later than expected. This is the optimistic view of things.

John, we are now at a stage where stocks are trading at less than 20 times earnings on an annualized and forward-looking basis . We have talked about revenue growth that is still double digits.

Is this a stock that's starting to look attractive?

Yes, I really tried to find loopholes in this idea, because, as Lowe pointed out , revenue growth is slowing, having recorded 16% in 2025, and is expected to reach 13% in 2026 for the whole year.

A slowdown in revenue growth is not something an investor would like to see, but 13% is still very good considering the size of the business. If you look at the operating margins, which are expected to rise year-on-year, they may be slightly lower than their all-time high, but they remain higher year-on-year, and as I said, this valuation has become more attractive.

Concerns about digital advertising may be exaggerated. So, I tried to find loopholes in the idea that this stock might turn into a good-value stock , but I'm having difficulty with that.

It is probably a good-value stock at the moment.

He's getting close to that. I mean , look, is it a technology company? I don't think it's really a tech company. It's a media company. Is it a growth story from this point ? I don't know if that's really the case, I mean, do you know what they are if they're an entertainment company?

You know, a valuation of 20 times earnings is probably about right .

I think there is something fundamental here. I don't think they will disappear. I think they will continue. But I think we need to change the shareholder base here. Investors who viewed Netflix as a tech growth story will have to sell their shares and exit, and will be replaced by people who are interested in a mature media or streaming company.

That will take some time . As an investor, I don't think looking at it now is a bad move, but I also don't think you need to rush. I think this is the situation that will continue for a while.

Yes, this is one of those stocks that I don't consider a completely guaranteed opportunity . I have never owned shares in Netflix, but I am interested in it because I believe it is one of the companies that will survive.

But you're right, Lou. Look at the other companies; they seem to have a much clearer story.

Netflix is in a less prominent position than it has been for a very long time.