Netflix Back-Peddles on Qwikster

Netflix announced that it no longer plans on spinning off its DVD rental-by-mail service into a separate company named Qwikster. Netflix CEO Reed Hastings posted the following on the company blog:

It is clear that for many of our members two websites would make things more difficult, so we are going to keep Netflix as one place to go for streaming and DVDs.

This means no change: one website, one account, one password… in other words, no Qwikster.

I wonder if this reversal has anything to do with the stock’s decline since the original split announcement. For fun, I decided to crunch some (simple) numbers. Netflix announced the Qwikster split on September 19 when the stock opened at 158.27. The last trading day before this new announcement was October 7 when the stock was valued at 117.21. That works out to ~26% devaluation since the original announcement.

Netflix Stock [2011.09.19 - 2011.10.07]