Investing.com -- On Friday, shares of South Korean companies associated with the Netflix Inc. (NASDAQ:NFLX) series "Squid Game" experienced a significant drop following the release of the show's new season. Artist United Inc., the movie distributor where "Squid Game" actor Lee Jung-jae is the largest shareholder, saw its shares plummet by the daily maximum of 30%. Wysiwyg Studios Co., also an investor in Artist United, witnessed a decline of up to 25%, and Dexter Studios Co., which collaborates with Netflix, experienced a 24% drop in its share price.
The original release of "Squid Game" in 2021 had been a monumental success globally, leading to a surge in the stock prices of local entertainment companies. The series not only became the most-watched title on Netflix across all continents but also earned the distinction of being the first non-English language program to receive a nomination for best drama at the Emmy Awards.
With the bar set high, the anticipation for the second season of the dystopian drama was substantial. The new season, which premiered on December 26, has garnered an 85% approval rating from critics and 65% from viewers on Rotten Tomatoes, despite some less-than-favorable reviews.
The market reaction to the latest season's debut starkly contrasts the initial enthusiasm that boosted entertainment stocks in South Korea two years ago. The first season's success had fueled investor optimism about the potential benefits of Netflix's search for additional blockbuster hits. However, the recent performance of related stocks indicates a changed sentiment following the newest season's reception.
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