Netflix shares fall as fourth-quarter forecast misses expectations

Netflix forecast fourth-quarter profit below analyst expectations on Tuesday and cut its 2026 advertising revenue target, sending its shares down more than 5 percent in after-hours trading despite third-quarter revenue rising 11.8 percent to $12.87 billion.

Why it matters: Revenue growth at the streaming leader is at its slowest in nearly three years and the guidance miss lands days after Netflix cut 6 percent of its staff and replaced two top programming executives, sharpening the question of where its next phase of growth comes from.

Data as of Netflix third-quarter results and shareholder letter of October 20, 2026, as reported by Reuters, read in full, with the guidance figures corroborated by AskTraders. Developing item.

Netflix issued a weaker than expected forecast for fourth-quarter profit on Tuesday, days after the streaming company laid off 6 percent of its workforce and replaced two of its top programming executives. The company forecast fourth-quarter net income of $2.79 billion and earnings of 67 cents a share, below the average analyst forecast of $3.07 billion and 73 cents, and cut its 2026 advertising revenue forecast to roughly $2.7 billion from about $3 billion, saying some advertising product capabilities had rolled out more slowly than expected. Shares fell more than 5 percent in after-hours trading.

Third-quarter revenue rose 11.8 percent to $12.87 billion, in line with Wall Street forecasts but the lowest rate of increase in nearly three years, while earnings per share of 87 cents beat the 82 cent average forecast. In its shareholder letter Netflix said it would license more third-party content and focus on its core streaming service, as it competes for viewing time with YouTube and TikTok.

Netflix shares fall as fourth-quarter forecast misses expectations

Sources