Netflix stock shows recovery signs after bombshell Lionsgate takeover report

A bombshell entertainment media report sent ripples throughout the movie industry this week, as the studio with the hottest film of 2026 could become part of the Netflix conglomerate.

Lionsgate Studios has never had a hit like "Michael," and it has been 13 years since "The Hunger Games: Catching Fire" came close to the Michael Jackson biopic's box-office haul.

"Michael" has topped $900 million at the global box office nine weeks into its theatrical run, driven by strong global receipts, surpassing the foreign cume of Freddie Mercury's biopic, "Bohemian Rhapsody," in like-for-like markets with a $533.8 million haul, according to Deadline.

Michael trails only "The Super Mario Galaxy Movie" in global box office sales ($1.01 billion to $935.6 million), according to BoxOffice Mojo.

That type of box office renaissance was bound to put Lionsgate back on the map, and according to the latest report from Semafor, Netflix is looking to acquire the movie studio.

Netflix eyes Lionsgate purchase

Netflix has had an appetite for acquisition for years that hasn't been quenched.

The company unsuccessfully tried to acquire Warner Bros. Discovery, only to be outbid by Paramount Skydance. It also reportedly tried to acquire streaming platform curator Roku before eventually pulling out of those negotiations, though Netflix has denied pursuing Roku. This week, Fox acquired Roku in a reported $22 billion cash-and-stock deal.

Now, Semafor is reporting that Netflix is wading back into the merger and acquisition waters, and Lionsgate could be the target. Netflix declined to comment to Semafor about the Lionsgate rumor, and Lionsgate declined to comment as well.

"We wrote in February that Netflix walked away from its bid for Warner Bros., especially battered.' Battered it may have been, but it is certainly undaunted," Semafor's Rohan Goswami reported.

"The streaming giant is understandably unwilling to subject itself to the kind of public scrutiny it did with Warner. But it is a time for consolidation, and there is no shortage of assets to pursue. One thing is certain: At both Warner Bros. Discovery and Roku, Netflix has shown fanatical focus on not overpaying. Roku may have been too rich for Netflix's blood, but Lionsgate - or another asset - may not be."

Netflix reportedly has not put in a formal indication of interest in Lionsgate Studios, and it is one of "a number of media companies" showing interest in the studio, according to Semafor.

But on Wednesday, Netflix denied the report, sending both stocks in different directions.

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Netflix stock shows a slight bounce while Lionsgate stock loses steam

The Semafor report from Tuesday sent Lionsgate shares soaring and Netflix's stock tumbling in trading. By Thursday, the roles were slightly reversed.

On Tuesday, Netflix shares dropped 4%, bringing its two-month decline to 27%, following a brief rally from late February to mid-April, according to Yahoo. Netflix is currently trading below the 50-day, 100-day, and 200-day moving averages and is down 16% year-to-date vs. a 10% gain for the S&P 500.

The company is still a month away from its second-quarter earnings release on July 16, and investors have been wary of the streaming company ever since it failed to raise its full-year 2026 revenue guidance range from between $50.7 billion and $51.7 billion.

It's full year operating margin guidance of 31.5% is also below Wall Street's consensus for 32%.

We see Netflix's recent earnings report as supportive of the long-term thesis - compounded revenue growth, rising margins (while investing in content and platform initiatives) & the scope to return capital in an outsized way (relative to annualized free cash flow)," Goldman Sachs analyst Eric Sheridan wrote in a note, according to Yahoo. Against these long theses, the short-term debate is likely going to stay anchored on themes around engagement trends and the building blocks (user growth, pricing, etc.) that underpin the company's Q2 revenue commentary."

Meanwhile, Lionsgate shares jumped 14% Tuesday to close at $16.36 per share. During intraday trading, it hit a record high of $16.70 per share.

But that momentum was short-lived; Lionsgate shares dropped 6% Wednesday after Netflix denied the report.

On Thursday, Lionsgate shares were down only 0.33% at last check, while Netflix shares were up 0.61%.

Related: Netflix has a stunning milestone in sight for 2027

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This story was originally published June 18, 2026 at 6:47 PM.