Stock Market Today, Oct. 22: Netflix Rises as Investors Capitalize on Post-Earnings Sell-Off

Netflix (NASDAQ:NFLX), a global subscription streaming entertainment and ad-supported video platform, closed at $67.05, up 3.09%, on Oct. 22. Shares rose as investors capitalized on a sharp post-earnings sell-off. Netflix stock fell the day prior, closing at $65.04, due to a softer-than-expected fourth-quarter outlook and a reduced 2026 full-year advertising revenue target of approximately $2.7 billion, down from $3 billion.

Trading volume reached 58.4 million shares, coming in 65% above its three-month average of 35.4 million shares. Netflix IPO'd in 2002 and has grown nearly 56,000% since going public.

How the markets moved today

The S&P 500 (SNPINDEX:^GSPC) closed at 7,663, down 1.22%, while the Nasdaq Composite (NASDAQINDEX:^IXIC) finished at 26,009, down 2.60%. Among internet entertainment and streaming media peers, Walt Disney (NYSE:DIS) closed at $113.13, up 1.16%, and Comcast (NASDAQ:CMCSA) closed at $22.84, up 3.44%, highlighting mixed trading across the group.

What this means for investors

On Oct. 22, investors stepped in to buy the dip on Netflix stock after shares plunged to some of their lowest levels of the year. Investor confidence was supported by management's aggressive capital return program. In the third quarter, Netflix made its largest stock repurchase in company history, buying back 63.9 million shares for $4.8 billion.

The streaming giant also reported stronger-than-expected Q3 diluted EPS and operating margins on Oct. 20. While this is encouraging, investors are cautiously awaiting January guidance after the disappointing Q4 outlook, which is still shaping investor focus on growth durability. Last week, Netflix cut roughly 6% of jobs in its biggest layoff since 2022, signaling tighter cost control as the company leans on ads, live events, and gaming to expand revenue.

In a sign the industry is shifting away from the earlier streaming wars, which focused on content exclusivity to gain subscribers, Netflix marked a new era with its historic licensing deal with Disney earlier this month. Disney will put some of its content on Netflix in the hopes of attracting consumers to its service, underscoring how catalog depth and distribution deals remain important in streaming competition.

Robert Izquierdo has positions in Comcast, Netflix, and Walt Disney. The Motley Fool has positions in and recommends Netflix and Walt Disney. The Motley Fool recommends Comcast. The Motley Fool has a disclosure policy.