Fund Manager Chris Versace Sells $NFLX Ahead of Earnings, Citing Rising Churn and a Weak Content Slate

Fund manager Chris Versace is selling Netflix ($NFLX) entirely from his TheStreet Pro portfolio ahead of its Oct. 20 earnings report. He had downgraded the stock earlier this week, citing rising membership churn and a lackluster content calendar.
According to Apptopia data cited by Versace, Netflix's U.S. churn crossed into double digits in Q3 2026, after running around 8% for the prior three quarters. Average time spent per daily active user in the U.S. has also drifted lower in recent quarters.
Versace said the October slate has few "must-see" titles. Season 2 of "Nobody Wants This" opened with 8.6 million views in four days, down 17% from Season 1, and Season 3 is released Oct. 22. Ben Affleck's "Animals" has put up strong numbers but holds a 31% Tomatometer rating.
Netflix is replacing Chief Content Officer Bela Bajaria with producer and former Fox executive Peter Rice, effective Oct. 26. Versace called the choice questionable, citing the poor reception for "The Social Reckoning," which has grossed about $9.8 million worldwide, and Rice's lack of streaming experience. Netflix CEO Ted Sarandos called Rice "one of the most effective at-scale operators in the entertainment industry."
Versace said Netflix is no longer a clear beat-and-raise company, and consensus 2027 EPS growth is only 5%-6%. He added that the timing of the headcount announcement raises questions, and that there are better opportunities in companies with stronger competitive positions and better growth prospects.