Despite an increasing subscriber count, Netflix revenue has remained flat. That doesn’t bode well for when the company eventually cracks down on password sharing, and the inevitable churn that will follow.

“They’re playing with fire in many ways, and as they say, you typically get burned,” explains Andrew Freedman in this clip from The Call @ Hedgeye. “If they can execute and pull this off, I’ll be impressed and will sing a different tune, but that’s not my base case.”

“They’re canceling their upfront advertising presentation, they’re cutting costs, the consumer confidence number for May was terrible,” adds Keith McCullough. “Today is quite literally the middle of the quarter for any company that’s on a calendar quarter, so you can handicap pretty well if you’re going to have a bad quarter … whether the CFO saw that or not, I’m going with not.”

Watch the full clip above.

Freedman: Playing With Fire May Burn Netflix | $NFLX - Call Banner