Netflix Stock Rose 4% While the AI Trade Sold Off on Monday. Its Capital Goes Into Shows, Not Silicon.

Shares of Netflix rose nearly 4% on Monday morning to approximately $80, diverging sharply from a broader sell-off across artificial intelligence infrastructure and semiconductor stocks. The rally was aided by Evercore ISI raising its price target on Netflix to $110 from $100, alongside growing investor appreciation for the company's capital allocation model, which is insulated from the soaring capital expenditure demands of the AI hardware build-out. While major tech players face surging data center and silicon investments, Netflix spent $9.9 billion on content in the first half of 2026 compared to just $415 million on property and equipment. The streaming giant projects roughly $12.5 billion in free cash flow for full-year 2026, supported by robust operating cash flow and a $2.8 billion merger termination fee. Although revenue growth has moderated to 13%-14%, strong cash conversion allowed the company to repurchase $4.7 billion of its stock in the second quarter, positioning it as an attractive alternative for capital seeking growth decoupled from intensive AI infrastructure spending.