LOS ANGELES, July 16, 2026 — Netflix announced third-quarter revenue and earnings projections that fell short of Wall Street expectations, causing its shares to drop nearly 8% in after-hours trading to $68.45.

The streaming giant forecast $12.86 billion in revenue and diluted earnings per share (EPS) of 82 cents for the July-September period. Analysts had anticipated $13 billion in revenue and EPS of 84 cents, according to LSEG.

PP Foresight analyst Paolo Pescatore commented that the projections "appear to reflect a combination of management caution and a naturally maturing growth profile, rather than any sudden deterioration in the business." He added that the results "reinforce the view that Netflix remains strong but is entering a steadier phase of growth with considerably less room for error given the always-high expectations."

Netflix also announced it will reduce its biannual viewing-hours report to an annual release starting January 2027 to focus on primary financial metrics such as revenue and operating profit. The company had already stopped publishing quarterly subscriber numbers in 2025. In April, Netflix reported having over 325 million paying members with potential for further growth.

The company described viewer engagement as "healthy," noting a 2% increase in viewing hours in the first half of 2026 compared to 1.5% growth a year earlier. Additionally, Netflix revealed that generative artificial intelligence is "scaling quickly" in production, having been used in about 300 titles, mostly in post-production.

Netflix stated, "Our financial performance remains solid and we're on track to meet our objectives for the year," despite the cautious outlook.

Sources