Netflix posts third-quarter earnings beat, says viewer engagement remains ‘healthy’
The streaming giant beat profit estimates but cut its ad outlook as view-hour growth slowed and leadership changes unsettled investors.
- On Tuesday, Netflix reported third-quarter revenue of $12.87 billion and earnings of $0.87 per share, beating Wall Street expectations, but issued weaker fourth-quarter guidance and cut its 2026 ad-revenue forecast to roughly $2.7 billion.
- Following a week of restructuring, Netflix replaced Chief Content Officer Bela Bajaria with former Disney executive Peter Rice, confirmed film chief Dan Lin's departure, and laid off about 1,000 employees, or roughly 6% of its workforce.
- Analysts highlight softening engagement, with monthly viewing time per member falling to 49 hours in early 2026 from 66 hours in 2023, while YouTube accounted for 14.2% of American TV viewing in July versus Netflix's 7.8% share.
- Co-CEO Ted Sarandos acknowledged the company "is not growing as fast as I want us to" on a post-earnings call, stating management will refocus on core streaming offerings to make Netflix a "must-have" service.
- Shares have declined more than 26% in 2026, erasing over $135 billion in market value, as investors remain focused on whether Netflix's upcoming content slate can reverse slowing revenue growth.
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Netflix loses pace of growth, shares fall - what losses can await streaming giant Netflix for the fourth time in a row predicts a slowdown in revenue growth, and its advertising business is <p>developing more slowly than expected. Since the beginning of the year, the company's shares have lost about a quarter of their value.</p>
The 10% cut in advertising revenue forecast has triggered the fall of their shares on Wednesday.
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