Netflix shares tumble after Q3 guidance disappoints
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The news: Shares in Netflix fell 8.2% to around USD68 ($97) in after-hours trading after the streaming company issued third-quarter revenue and earnings guidance that missed Wall Street expectations.
The context: Netflix forecast third-quarter revenue of USD12.8 billion and diluted earnings per share of 82 US cents. LSEG consensus estimates had been for revenue of USD13 billion and diluted earnings per share of 84 US cents.
Despite the weaker outlook, second-quarter results were broadly in line with analyst expectations. Revenue rose 13% to USD12.56 billion from USD11.08 billion a year earlier, while net income increased to USD3.40 billion from USD3.13 billion. Operating income climbed to USD4.19 billion from USD3.77 billion a year earlier.
Netflix also said it will reduce the publication of its viewing-hours report from twice a year to once annually from January 2027, saying the change would “keep the focus on our primary financial metrics, revenue and operating profit.” The company stopped reporting quarterly subscriber numbers in 2025.
