Netflix Stock Has Gained in the Fourth Quarter in 17 of the Last 24 Years

Netflix (NASDAQ:NFLX) has a good fourth-quarter record. Going back to 2002, the shares ended the final three months of the year up in 17 of 24 years. This count goes from the last closing price in September to the last close in December, adjusted for stock splits.

And in a typical year, the rise was big. The median fourth-quarter return across these 24 years was around 12%.

The latest fourth quarter, though, went the other way. Netflix shares began it near $120 and finished it under $94, a loss of about 22%.

This year's quarter starts at a far lower point. At roughly $72 as of this writing, the stock is up about 4% since September ended but still trades 42% under its 52-week high of $124.86.

The company posts its third-quarter results on Tuesday, Oct. 20.

A record like that can make the calendar look like it's on Netflix's side. But I don't think the calendar deserves much of the credit. In most of those years, the October report seemed to set the quarter's direction.

Image source: Getty Images.

Big October moves usually hold

Netflix releases its third-quarter results a few weeks into the fourth quarter, and the growth stock's reaction the next trading day has been a surprisingly good guide to how the quarter ends. Since 2004, Netflix has seen 14 one-day moves of 10% or more just after its October report. In 13 of those years, the shares closed the fourth quarter in the same direction.

The past four years show how it works. After the October reports in 2022, 2023, and 2024, the stock jumped 13%, 16%, and 11% the next day -- and then finished those fourth quarters up around 25%, 29%, and 26%.

Last year it worked in reverse. Shares dropped 10% the day after the October 2025 report, when an expense linked to a dispute with Brazilian tax authorities brought Netflix's third-quarter operating margin down to 28%, under the 31.5% management had forecast. The stock kept slipping into December, when Netflix agreed to buy Warner Bros. (a deal canceled in February). And the quarter ended with that 22% loss.

The only exception was 2012, when a 12% fall after the October report gave way to a 70% gain for the full quarter.

Smaller reactions have said far less. In the eight years the stock moved less than 10% after its October report, the fourth quarter went the other way six times.

Growth has slowed all year

What's changed since last October is the growth picture. A year ago, the streaming service headed into its fourth quarter with revenue growth picking up. Third-quarter 2025 revenue climbed 17% year over year, and management forecast 17% growth in the fourth quarter, too.

Shares dropped anyway.

This year, the trend goes the other way. Showing how steady the slowdown has been, Netflix's revenue rose 18% year over year in the last quarter of 2025. Growth has cooled every quarter since, dropping to 16% in the first three months of 2026 and 13% from April to June. And management's forecast calls for 12% in the third quarter.

Sure, investors already know about the slowdown, and the stock price arguably reflects much of it. Shares cost around 19 times the earnings analysts expect for 2027 -- arguably a fair price for a business whose revenue is still growing at a double-digit rate.

What could swing this quarter?

I think the fourth-quarter forecast will probably count more on Oct. 20 than the third-quarter results themselves. In July, management narrowed its full-year revenue outlook to a range of $51.0 billion to $51.4 billion. Along with its third-quarter forecast, that range allows for fourth-quarter revenue growth anywhere from around 11% to 14%.

A forecast near the top of that range would mean growth speeding up from the third quarter's rate for the first time since late 2025. News like that might cause one of those double-digit moves higher.

True, a forecast near the bottom may be smaller news than last year's margin miss. But it'd be yet another step down in growth. Shares have already dropped around 23% in 2026 as growth has slowed.

Seventeen gains in 24 years is a good record. But I wouldn't bank on it this year. I'd put much more weight on what Netflix says about fourth-quarter growth on Oct. 20.

Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Netflix. The Motley Fool has a disclosure policy.