Hedge Fund Manager Bill Ackman Sells Netflix Stake At $435 Million Loss

Prominent hedge fund manager Bill Ackman has sold his entire stake in streaming giant Netflix (NFLX), taking a $435 million U.S. loss in the process.

Ackman sold his Netflix position less than three months after buying more than $1 billion U.S. of the stock.

Ackman’s hedge fund, Pershing Square Holdings (PSH), said it sold its Netflix holdings after the movie and television streaming company reported an unexpected drop of 200,000 subscribers in the first quarter and projected an even steeper decline in the current one.

Netflix shares fell 35% to $226.19 the day after the company’s latest earnings were made public earlier this week, making the stock the worst performer in the S&P 500 index so far this year.

Ackman became one of Netflix’s 20 largest shareholders in January of this year, buying after the stock had already begun to dip over concerns about its subscriber base. His fund lost a reported $435 million U.S. on its 3.1 million share position.

Netflix shares climbed as the coronavirus pandemic took hold and peaked in November last year, more than doubling from the start of 2020. With Wednesday’s plunge, the stock is now down 62% year to date.

In a letter to shareholders, Ackman said his fund overall is down 2% so far in 2022. He said he has learned from past mistakes to exit bad bets early. He said he will redeploy the money from the Netflix stock sale to other investment opportunities.