- Netflix (NASDAQ:NFLX) is laying off about 150 of its employees
- The company is reducing its costs as its growth decelerates
- Two well-known investment firms sold all of their NFLX stock in recent months
Netflix (NASDAQ:NFLX) stock is likely on many investors’ radar after the company stated yesterday that it was dismissing about 150 of its employees. Moreover, two prominent investment firms have sold all of their NFLX stock.
The layoffs and the sales of Netflix’s shares are occurring after the company reported lower-than-expected first-quarter revenue and unexpectedly stated that its user base shrunk in Q1. Netflix expects its user base to meaningfully decline again during the current quarter.
On the positive side, however, a research firm upgraded the shares earlier this week.
In a statement to CNBC, a Netflix spokesman explained that the company was carrying out the layoffs due to its need to cut costs amid the deceleration of its business. However, the streaming company is laying off less than 2% of its workforce.
According to The Verge, Netflix is also cutting “at least 26 contractors working on the company’s fan-focused Tudum website, which serves as a supplement to Netflix’s content.”
2 Investment Firms Sold Their NFLX Stock
Tiger Global, run by billionaire Chase Coleman, sold all of its shares of Netflix last quarter. And Pershing Square Capital Management, which well-known billionaire Bill Ackman controls, unloaded all 3.1 million shares of NFLX stock, taking a big loss of roughly $435 million on the investment.
Wedbush Upgraded Netflix
On May 16, research firm Wedbush raised its rating on the shares to “outperform” from “neutral.” The firm thinks that upcoming episode releases may cause Netflix’s Q2 results to surpass expectations. Wedbush placed a $280 price target on the name.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.