Netflix shares are down 10% due to its recent IPO. The company will be listed on the New York Stock Exchange, and the initial public offering (IPO) price will be $12 per share.
Netflix was valued at $40 billion before the IPO. After the listing, the shares will trade under the symbol “NFLX” on the NYSE.
The valuation of Netflix shares is currently more than double the price that the company was valued at prior to the IPO.
Here are the reasons why the company has lost its value so much:
Competition from other streaming services such as Amazon Prime and HBO Go, which are available in more countries, is expected to impact Netflix. These two companies are now offering their services to more than 80 million customers.
The cost of production is high, and the prices charged by Netflix are expensive.
The company is expected to generate about $8.6 billion in revenue this year.
The company has been raising money to fund operations.
Netflix is expected to lose $1.6 billion this year.
It is very unfortunate that the company will now be listed on the stock market. The listing has led to a loss in the value of the company.