Shares of Netflix Inc (NASDAQ:NFLX, ETR:NFC) fell nearly 5% and Walt Disney Co (NYSE:DIS, ETR:WDP) dropped 3.2% in premarket trading on Monday after US President Donald Trump said he plans to impose a 100% tariff on films produced overseas.
In a post on Truth Social late Sunday, Trump announced he had directed the Commerce Department and the US Trade Representative to “immediately begin the process of instituting” the tariff, which he framed as part of his effort to boost domestic film production.
“WE WANT MOVIES MADE IN AMERICA, AGAIN!” he wrote.
The proposed policy would mark the first time a US administration has applied trade tariffs to the entertainment sector.
Trump’s announcement blindsided Hollywood studio executives, who scrambled to assess the potential implications, according to the Wall Street Journal.
The move could have broad implications for companies like Netflix, which has increasingly shifted production overseas to cut costs and expand its international content library. More than half of Netflix’s programming is now produced outside the US, according to industry analysts.
Many US films are made partially or entirely abroad, especially in countries such as the United Kingdom and Canada that offer generous tax incentives.
Commerce Secretary Howard Lutnick posted on social media platform X that “we’re on it,” without elaborating on how the tariffs would be applied or what timeline was being considered.
It remains unclear how such a tariff would be implemented, given the complexity of global film production and the challenges of valuing intellectual property for customs purposes.