Part 3/13:
The financial impact of these cultural clashes was palpable. Netflix’s shares declined by approximately 7% following a disappointing quarterly earnings report. Disturbingly, this marked a break in their streak of exceeding analyst forecasts. The report cited a hefty $619 million dispute with Brazil over taxes—specifically, Brazil’s 10% tax on outbound payments for royalties and licensing. While Netflix classified this as a cost of doing business rather than a tax on profits, it still weighed heavily on their financial statements.