Third-quarter earnings of $0.87 a share beat expectations of $0.82, while revenue rose 12% to $12.87 billion, matching estimates but marking a fourth consecutive quarter of decelerating top-line growth and the slowest pace since the third quarter of 2023. Third-quarter free cash flow of $2.88 billion fell short of the $3.22 billion consensus, and Netflix trimmed its full-year 2026 forecast to $51.1 billion in revenue, below the $51.23 billion estimate, about $12 billion in free cash flow, down from $12.5 billion due to a fourth-quarter real estate transaction, and roughly $2.7 billion in ad sales, down from $3 billion because of a slower rollout of ad product capabilities.
The quarterly shareholder letter omitted any mention of Netflix's video game business, where only 3.5% of subscribers play monthly, an internal memo cited by the Wall Street Journal showed. As monthly viewing per member fell to about 49 hours from 66 hours, the company named former Disney executive Peter Rice as chief content officer and announced plans to expand its advertising tier to 15 additional countries in 2027.