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Netflix Stock Briefly Showed a 90% Decline — Don’t Worry, It’s Just a Stock Split

When I checked the market this morning, I nearly dropped my coffee.
Netflix’s stock chart showed a massive 90% crash in just seconds.
For a moment, even I felt my heart skip.
But within a minute, the truth came out — it wasn’t a crash at all.

It was a stock split.

If you’ve never seen this happen before, I totally understand why it looks scary.
A huge drop on a chart usually means something terrible happened.
But in this case, the company wasn’t collapsing.
Netflix simply adjusted its share price to make its stock more “friendly” to investors.

So today, I want to help you understand exactly what happened and why it actually might be good news.
I'm going to break this down in the simplest way possible, while sharing my own thoughts as an investor.

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What Exactly Happened to Netflix’s Stock Price?

Netflix announced a 10-for-1 stock split, which means every existing share was divided into 10 smaller shares.
If one share was $900 before, after the split it becomes $90.
You still own the same value, but now you hold more shares.

When the split took effect, the price chart updated instantly.
This made it look like Netflix “crashed” 90%, even though nothing bad happened.
It was just math — not a meltdown.

Some trading platforms already adjusted the price, while others took a bit longer.
This created a few moments of confusion and panic across social media.

A Quick Example to Make It Simple

Let’s imagine you have 1 pizza worth $20.
If someone cuts it into 10 slices, you don’t suddenly lose money.
You still have $20 worth of pizza.
You just have more pieces.

That’s all a stock split is.

Netflix didn’t lose value.
It simply cut its “pizza” into more slices so more people could buy those slices easily.

Why Companies Choose Stock Splits

Netflix is not the first major company to do this.
Apple, Tesla, Amazon, and Nvidia have all used stock splits before.
And each time, the reason is similar: make the stock more accessible.

When a share becomes too expensive, fewer people want to buy it.
Some new investors feel left out.
Others cannot afford to buy even one share.

By lowering the price per share, Netflix:

• Attracts more small investors

• Increases trading volume

• Makes the stock feel more “affordable”

• Creates positive attention in the market

Many companies use stock splits when the share price becomes too high compared to similar companies.

But Why Did Netflix Need a Split Now?

Let me share my personal view.

Netflix has had an incredible run in the last two years.
They added millions of new subscribers.
Their ad-supported plan grew faster than expected.
Their crackdown on password sharing brought in huge revenue.

As the business grew, the stock price shot up.
Before the split, Netflix shares were trading at levels many new investors couldn’t reach.

A lower price makes it easier for younger investors, new investors, and global investors to buy the stock.
This usually leads to more interest — and sometimes even higher prices over time.

The 90% Drop Scared Many People — And That’s Normal

Even though I understand how stock splits work, seeing a sudden 90% crash still feels shocking.
Our brains are trained to react to danger.
And a big red drop on a chart looks like danger.

But here’s the truth:

The chart was not telling the full story.

This is why understanding the markets — even at a basic level — is so important.
When you understand “why” something happens, you feel less fear and make better decisions.

Is a Stock Split Good or Bad for Investors?

Let’s answer the big question.

A stock split does not change:

• The company’s revenue

• The company’s profit

• The company’s business model

• The total value of your holdings

• The company’s long-term potential

But it can create benefits:

1. More investors can buy the stock

Trading becomes easier, especially for beginners.

2. Psychological boost

People like seeing “lower prices,” even if the value is the same.

3. More liquidity

More trades happening every day.

4. Often signals confidence

A company usually splits its stock when it believes the long-term trend is strong.

Netflix wouldn’t split its shares if it thought the future was uncertain.

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What Smart Investors Do During Stock Splits

Let me share what I personally do when I see a stock split — whether it’s Netflix or any other company.

1. I check if the business is still strong

A split is pointless if the company is weak.

2. I look at long-term trends

Are subscribers growing?
Is revenue stable?
Are profits rising?

3. I ignore the “price scare”

The lower price is just math.

4. I stay calm and study

Because moments like these create emotional reactions among investors.

Let’s Talk About Netflix’s Business

Understanding the company behind the stock is the key to making good decisions.

Here’s what Netflix has going for it:

• It’s the biggest streaming service in the world

• It has more than 250 million subscribers

• Its advertising tier is growing

• Its content spending is strategic and global

• It has pricing power

• It continues to expand beyond traditional streaming

Netflix is also working on:

• Games

• Live events

• Sports broadcasting

• Global partnerships

These help Netflix build a moat — something Buffett loves.
They make Netflix harder to replace.

Why This Stock Split Might Attract More Long-Term Investors

Let’s be honest: many young investors don’t have thousands of dollars to buy one share.
But at a lower price, Netflix becomes much more approachable.

This matters because:

• More people = more demand

• More demand = healthier trading

• Healthy trading = stronger long-term support

Also, when a stock is easier to buy, it becomes a popular “starter stock.”
A stock new investors like to hold for years.
Netflix wants that kind of attention.

Will the Stock Go Up After the Split?

Let me be very clear.
A stock split doesn’t automatically make the price rise.
There is no magic formula.

But historically:

• Apple rose after splits

• Tesla rose after splits

• Nvidia rose after splits

Why?

Because splits create excitement.
Excitement brings new buyers.
New buyers can push the price higher.

Will this happen to Netflix?
Maybe — and maybe not yet.
But the split tells me the company is confident in its future.

The Emotional Side of Investing

If there’s one thing I’ve learned over the years, it’s this:

Most losses happen because of panic, not because of bad companies.

A sudden red chart makes our brains race.
We imagine the worst.
We feel pressure to act quickly.

But the investors who win over time are usually the calm ones.

They read.
They study.
They think long term.
They don’t react emotionally.

This Netflix moment is a perfect example.
A beginner might panic and sell, thinking a crash happened.
A pro takes 5 seconds to understand it was a stock split.

What I Want You to Learn From This Event

This whole situation is actually a great teaching moment.
Here are the key lessons:

1. Always understand what you’re looking at

Charts can be misleading.

2. Not every “drop” is bad news

Sometimes it’s just math adjusting prices.

3. Stock splits are usually positive signals

Companies don’t do them when business is bad.

4. Stay calm and read carefully

Quick decisions often lead to regret.

5. Focus on the business, not the chart

The business is what drives long-term results.

Should You Buy Netflix After the Split?

I can’t tell you what to do.
But here’s how I personally think about it.

If I believe a company will grow for the next 5–10 years…
If I see rising subscribers, rising revenue, rising profits…
If I see strong leadership and global expansion…

Then a stock split simply makes the entry price more attractive.

If I didn’t believe in the company, I wouldn’t care about the split at all.
A split doesn’t save a weak business.

Netflix, however, is a strong business with a clear future.
So for long-term investors, this event is more of an opportunity than a warning.

Final Takeaways

I want to end with the most important message of this entire article:

Stock splits do not change your wealth — they just change the number of shares you own.

Netflix’s 90% “drop” was not a crash.
It was a simple price adjustment.
The business remains the same.
The value remains the same.
Your investment remains the same.

When you see something shocking on a chart, breathe.
Zoom out.
Study.
Then decide.

This is how smart investors survive.
And this is how smart investors grow.

My Final Advice for You as Your Newsletter Writer

• Don’t panic on sudden price drops

• Learn the basic mechanics of the market

• Understand the companies you invest in

• Stay patient and think long term

• Build your knowledge one day at a time

If you keep doing this, you will grow into a confident investor.
And moments like today will no longer scare you — they will guide you.

[Live Life Grow Wealth]

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DISCLAIMER

I make no representations, warranties, or guarantees, whether expressed or implied, that the content provided is accurate, complete, or up-to-date. Past performance is not indicative nor a guarantee of future returns.

I am an individual content creator and not regulated or licensed by the Monetary Authority of Singapore (MAS) as I do not provide investment services.

All forms of investments carry risks, including the risk of losing your entire invested amount. Such activities may not be suitable for everyone. You are strongly encouraged to seek advice from a professional financial advisor if you have any doubts or concerns.