Netflix (NFLX) reported fourth quarter earnings after the bell on Tuesday that showed better-than-expected results but said it would ramp up its rollout of new content in the year ahead and pause its share repurchase program given its pending acquisition of Warner Bros. Discovery (WBD).
The streaming giant reported revenue of $12.05 billion, more than Wall Street estimates for $11.96 billion, per Bloomberg consensus data, which matched the company’s own forecast. In the fourth quarter of last year, the company posted revenue of $10.25 billion.
Earnings per share came in slightly higher than expected at $0.56, versus the Street’s forecast of $0.55. That’s against Netflix’s forecast expectation of $5.45, or $0.55 per share following the 10-for-1 stock split in mid-November.
The company also disclosed that it now has more than 325 million members worldwide.
Revenue for the full year came in a tick higher than expected at $45.2 billion, compared to Wall Street’s forecast of $45.1 billion, representing 16% growth for the year. Netflix said Tuesday that its 2026 revenues are expected to fall in a range of $50.7 billion to $51.7 billion, representing 12%-14% growth.
For the first quarter, Netflix is forecasting 15.3% growth in revenue to $12.16 billion and adjusted earnings of $0.76. That’s more than what Wall Street expected of $10.54 billion with adjusted earnings of $0.66.
Its slower growth rate signals the company will look to increase the rollout of its own content in the year ahead, and uncertainty about the Warner Bros. deal weighed on the stock, which fell as much as 5% in after-hours trading on Tuesday.
In its shareholder letter, Netflix said engagement in the second half of the year was powered by a 9% rise in viewing of its original content but offset by an engagement decline in its non-branded content.
“This decrease primarily reflected a lower volume of licensed, second-run content across most regions following an elevated period of licensing during 2023-2024 as a result of the WGA strike, which temporarily shut down new production,” the company said in its letter.
On a call with analysts, CFO Spencer Neumann said, “You should see higher year-over-year content expense growth in the first half of ’26, growing off of that smaller base that we had in the first half of last year.”
Following the report, Frank Albarella, KPMG US sector leader of Media & Telecommunications, told Yahoo Finance, “As catalogs grow, costs rise, live formats expand, and experiences and acquisitions reshape expectations. Breadth is no longer a simple advantage; it’s a more complex responsibility. The real work now is transforming that breadth into something coherent, adaptable, and resilient enough to define the next era of the industry.”
Before the market open on Tuesday, Netflix said it amended its agreement to acquire Warner Bros. Discovery to an all-cash deal at $27.75 per WBD share, or $72 billion in equity value. That’s compared to the Ellison family-backed Paramount Skydance (PSKY) all-cash offer of $30 per share, or $108 billion.
The Paramount offer includes the cable and news assets of the combined company; Netflix is only bidding for Warner Bros.’ film and streaming assets.
Paramount, Netflix and Warner Bros logos are seen in this illustration taken December 8, 2025. REUTERS/Dado Ruvic/Illustration/File Photo · Reuters / Reuters
Asked by Guggenheim analyst Mike Morris on the call if Netflix had plans to raise prices, co-CEO Gregory Peters responded, “There is no impact or change to our approach and how we’re running the business in that regard.”
It also plans to keep the traditional rollout of Warner Brothers films, with a 45-day window in theaters before heading to streaming.
When asked about regulatory approval, Netflix co-CEO Ted Sarandos said, “We’ve already made progress towards securing the necessary regulatory approvals.”
He added, “Our deal strengthens the marketplace, and it ensures healthy competition that will benefit consumers and protect and create jobs. That’s why we’re confident in the approval.”
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Brooke DiPalma is a reporter for Yahoo Finance. Follow her on X at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.
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