- Deutsche Bank upgraded Netflix to Buy from Hold after a sharp 2026 decline, arguing that international engagement, global content production and artificial intelligence could be underappreciated by investors.
Netflix Inc. (NASDAQ: NFLX) shares are facing a rare split in Wall Street sentiment after a difficult September, but Deutsche Bank has taken a more constructive view of the stock. Analyst Bryan Kraft upgraded Netflix to Buy from Hold on Sept. 29, while lowering the bank's price target to $95 from $100. Netflix closed Tuesday at $70.30, up 1.55%, after the upgrade. The new target was still roughly 35% above that closing price.
The call came after Netflix shares fell more than 14% in September and more than 26% year to date, according to market data reported Tuesday. The stock's decline has been driven in part by concerns about viewer engagement and the company's decision to reduce the frequency of its detailed view-hours disclosures.
Deutsche Bank's argument is that investors may be placing too much weight on weaker US engagement while overlooking the company's international scale.
Why Deutsche Bank Is Bullish on Netflix Stock
Kraft's thesis centers on Netflix's international production and audience footprint. More than 60% of Netflix's production now takes place outside the US, according to the Deutsche Bank analysis cited by CNBC and other reports. Kraft argues that the company's established international production network gives it an advantage as it develops content for audiences across different markets.
Netflix's own second-quarter shareholder letter provides supporting evidence for the scale of that international business. In the second quarter, revenue from Europe, the Middle East and Africa reached $4.03 billion, up 14% year over year, while Latin American revenue increased 21% to $1.58 billion. Asia-Pacific revenue rose 16% to $1.51 billion.
The company also reported that non-English content generated more than one-third of all viewing during the first half of 2026, with programming from countries including South Korea, Japan, Spain and India contributing to viewing growth. Netflix reported $12.56 billion in second-quarter revenue, an increase of 13% from the same period a year earlier. Operating income reached $4.19 billion, while operating margin was 33.4%.
The company also expects advertising to become a larger contributor to revenue. Netflix said it remains on track for approximately $3 billion in advertising revenue in 2026, roughly double the prior year's level.
Artificial intelligence is another part of the Deutsche Bank thesis. Netflix is already using AI for personalization, search, advertising and parts of content production. The company said GenAI workflows were used across roughly 300 titles during 2026, with the largest concentration in post-production.
Netflix Faces a Divided Wall Street
The Deutsche Bank upgrade does not mean concerns surrounding Netflix have disappeared. Netflix's own filings acknowledge that engagement, competition, content quality and consumer usage remain important risks. The company also announced in July that it would move its detailed What We Watched report from twice a year to an annual publication beginning in 2027. Netflix said the change would keep greater attention on revenue and operating profit while continuing to publish title-level and weekly Top 10 data.
Several analysts have taken a more cautious stance. Wells Fargo downgraded Netflix to Underweight earlier in September and assigned a $57 price target, while HSBC moved the stock to Hold and reduced its target to $76. Those calls have added to investor concerns over engagement and competition for viewing time.
The contrast between those views and Deutsche Bank's upgrade highlights the central issue facing NFLX: whether recent weakness in US engagement is temporary or indicative of a broader change in consumer behavior.
Netflix's next major scheduled catalyst is its third-quarter 2026 earnings report on Oct. 20. The company said it expects third-quarter revenue of $12.86 billion, representing 11.7% year-over-year growth, based on the forecast included in its second-quarter shareholder letter.
For now, Deutsche Bank's $95 target represents an analyst forecast rather than a guaranteed outcome. The market will have additional financial and operating data to assess when Netflix reports its third-quarter results.