Netflix reports Q3 revenue growth amid slowing outlook

Netflix reported third-quarter revenue of $12.87 billion, an 11.8 percent increase year-on-year, and a net income of $3.66 billion, representing a 43.9 percent rise. Despite these gains, the company's stock fell nearly 5 percent in after-hours trading as investors reacted to a decelerating revenue growth rate and a lowered advertising revenue outlook for 2026, now projected at $2.7 billion compared to the previous $3 billion estimate.

In India, the company saw significant success, recording its largest-ever quarter of paid net additions driven by local content like ‘Lock Upp’ and a loyalty bundle with Flipkart. Globally, Netflix is navigating a shift in strategy, including plans to expand its ad-supported service to 15 more countries by 2027 and increasing investments in live sports, such as the 2030 World Cup.

Management also highlighted a focus on content execution and cost controls. The company plans to release approximately 30 films in theaters next year, testing longer theatrical windows for select titles. However, concerns remain regarding the pace of revenue expansion and the creative challenge of maintaining subscriber engagement as price increases continue.