"However, because many of the costs associated with the deal will be front-loaded in Q1 2026, the company's guidance for the quarter fell short of analyst expectations with earnings projected at $0.76 per share versus consensus estimates around $0.85. As a result, Netflix stock is falling over 7% in premarket trading this morning, indicating serious investor concerns over the near-term pressures Netflix faces and the merger's execution."
"Looking ahead, Netflix is forecasting 2026 revenue between $50.7 billion and $51.7 billion, representing 12% to 14% year-over-year growth, or 11% to 13% on a currency-adjusted basis. The company expects operating margins to expand to 31.5%, driven by membership increases, pricing adjustments, and ad revenue roughly doubling to about $3 billion. Free cash flow is also projected to be robust, around $11 billion, or 16% higher from 2025, assuming a cash content spend to amortization ratio of about 1.1x."
"Netflix ( NASDAQ:NFLX ) reported strong fourth quarter results that beat Wall Street estimates on revenue and earnings per share. As it gears up for the acquisition of Warner Bros Discovery ( ) studio and streaming assets, Netflix also attempted to convince investors that its all-cash bid that values the company at $83 billion was good for the company."
Netflix reported a strong fourth quarter with $12.1 billion in revenue, up 18% year-over-year (17% excluding FX), and adjusted EPS of $0.56. The company surpassed 325 million net paid subscribers and saw ad revenue more than double to over $1.5 billion for the year. Netflix is pursuing an $83 billion all-cash acquisition of Warner Bros. Discovery studio and streaming assets, which will front-load costs in Q1 2026. Q1 guidance of $0.76 EPS missed analyst expectations and pushed premarket shares down over 7%. Netflix forecasts 2026 revenue of $50.7–$51.7 billion, 31.5% operating margins, and roughly $11 billion in free cash flow.
Read at 24/7 Wall St.
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