Netflix on Thursday announced a 10-for-1 forward stock split. According to Yahoo Finance, shareholders will receive 10 shares for every one share they currently own. The streaming company stated the move aims to make stock more accessible to employees participating in its stock option program.

CNBC reports that shareholders of record as of November 10 will receive nine additional shares for each share held. The additional shares will be distributed after the close of trading on November 14. Trading on a split-adjusted basis begins November 17. Netflix stock closed at $1,089 on Thursday before rising more than 2% in after-hours trading following the announcement.

This is Netflix's third stock split since going public. The company previously split its stock 2-for-1 in 2004 and 7-for-1 in 2015. The split will reduce the per-share price to approximately $110 based on current trading levels.

Why This Matters

High share prices create financial barriers for employees exercising stock options. When Netflix shares trade above $1,000, the capital required to exercise options becomes substantial. Variety notes that Netflix is one of only 10 companies in the S&P 500 with a share price exceeding $1,000.

The split directly benefits Netflix's workforce by reducing the upfront cost of participating in equity compensation programs. Employees can now acquire the same ownership stake with significantly less capital. This aligns employee incentives with company performance while maintaining affordability.

For existing shareholders, stock splits typically generate positive market reactions despite having no effect on company fundamentals. The Motley Fool reports that Netflix shares have climbed 44% over the past year and 116% over five years. The company now has over 300 million paid memberships generating substantial revenue growth.

Industry Implications

The Netflix split reflects a broader trend among high-performing technology companies managing soaring share prices. Multiple major tech firms completed splits in 2024, including Nvidia, Broadcom, and Walmart. These moves address concerns about nominal affordability for retail investors unable to purchase fractional shares through certain brokers.

Stock splits can influence market psychology and trading activity. Research suggests shares often outperform following split announcements as investors perceive management confidence. However, the fundamental value and business operations remain unchanged. A $1,000 share split into 10 shares worth $100 each represents identical ownership.

Netflix's financial performance supports the decision. For the first nine months of 2025, the company generated revenue that grew 15% year over year to $33.1 billion. Operating margin expanded to 31.3% in 2025 from 27.4% in 2024. However, Variety reports that Q3 earnings per share missed Wall Street expectations due to a $619 million charge related to a Brazilian tax dispute.

The streaming giant faces increasing competition from Disney+, HBO Max, and other platforms. Netflix maintains its leadership position through content investment and international expansion. The company broadcasts in 50 languages across 190 countries, reaching over half a billion people worldwide according to The Motley Fool.

Further Reading

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