Netflix (NFLX) co-CEO Ted Sarandos pushed back on merger speculation Tuesday following Warner Bros. Discovery’s (WBD) announcement that it’s exploring breakup options, including a potential sale of the entire company. “We’ve been very clear in the past that we have no interest in owning legacy media networks,” Sarandos said on the company’s third quarter earnings call. “There’s no change there.” His comments came just hours after WBD said it had launched a “review of strategic alternatives” following uns ...

Core Viewpoint - Netflix is reportedly interested in acquiring Warner Bros. Discovery, which has officially put itself on the market, but the company's Co-CEOs indicated that major acquisitions are not a priority for them [2][3]. Financial Performance - Netflix experienced a revenue increase of 17% in Q3, but reported an earnings-per-share miss due to a complex tax dispute in Brazil, which affected operating margins, dropping them to 28% from a previously guided 31.5% [3][12]. - The company attributed the earnings miss to an unexpected tax issue with Brazilian authorities, which involves back payments related to technology usage fees [12][13]. Acquisition Interest - Co-CEO Ted Sarandos stated that Netflix has no interest in owning legacy media networks and emphasized the need for acquisitions to strengthen existing capabilities or accelerate strategy [3][4]. - Analysts express skepticism about the strategic fit of Warner Bros. assets for Netflix, suggesting that most of these assets do not align with Netflix's corporate priorities [8][9]. Market Dynamics - The current consolidation in Hollywood is viewed as not fundamentally changing the competitive landscape, with previous mergers yielding varied outcomes [5][6]. - Analysts noted that acquiring another company may not help Netflix develop the necessary capabilities to compete globally in streaming video [5][10]. Future Growth Strategies - Netflix's growth is expected to come from its ad-supported tier, which has doubled revenues from the previous year, and from investments in live events and sports [14][15]. - The company is cautious about entering into expensive long-term broadcasting deals, unlike traditional media companies [15].

Netflix (NFLX) reported third quarter earnings that missed analyst expectations on both revenue and profit, sending shares over 8% lower in trading on Wednesday. Netflix reported revenue of $11.51 billion, just shy of Bloomberg consensus estimates of $11.52 billion and slightly below the company’s own guidance of $11.53 billion. That compares to $9.82 billion in the same quarter last year. Earnings per share came in at $5.87, missing analyst expectations of $6.94 and Netflix’s internal forecast of $6.87, ...

Netflix co-CEO Greg Peters took another dig at big media M&A today as Warner Bros. Discovery formally put itself in play, calling studio mergers no sort of solution to the industry’s challenges. “You have to do that by the hard work of developing those capabilities in the trenches day to day. You don’t get there simply by buying another company that is also still developing those same capabilities,” he said on the giant streamers quarterly earnings webcast. “Think about Disney Fox, and Amazon picking up MG ...

Netflix (NasdaqGS:NFLX) Q3 2025 Earnings Call October 21, 2025 04:45 PM ET Company ParticipantsTed Sarandos - Co-CEOGreg Peters - Co-CEOSpencer Wang - VP of Finance, IR and Corporate DevelopmentSpencer Neumann - CFOSpencer WangGood afternoon and welcome to the Netflix Q3 2025 earnings interview. I'm Spencer Wang, VP of Finance, IR, and Corporate Development. Joining me today are Co-CEOs Ted Sarandos and Greg Peters, and CFO Spence Neumann. As a reminder, we will be making forward-looking statements, and act ...

Netflix (NasdaqGS:NFLX) Q3 2025 Earnings Call October 21, 2025 04:45 PM ET Company ParticipantsTed Sarandos - Co-CEOGreg Peters - Co-CEOSpencer Wang - VP of Finance, IR and Corporate DevelopmentSpencer Neumann - CFOSpencer WangGood afternoon and welcome to the Netflix Q3 2025 earnings interview. I'm Spencer Wang, VP of Finance, IR, and Corporate Development. Joining me today are Co-CEOs Ted Sarandos and Greg Peters, and CFO Spence Neumann. As a reminder, we will be making forward-looking statements, and act ...

Financial Data and Key Metrics Changes - The company reported revenue in line with expectations for Q3 2025, with operating income impacted by a Brazilian tax matter, which would have exceeded forecasts otherwise [2][10] - Engagement metrics showed record share TV time in Q3 in both the U.S. and the U.K., indicating healthy user engagement [2][17] - The company is on track to more than double ad revenue this year, marking significant growth in its advertising segment [2][12] Business Line Data and Key Metrics Changes - The live offerings and gaming segments are being expanded, with notable events like the Canelo Crawford fight achieving record viewership [3][26] - The K-pop, Demon Hunters film has become a cultural phenomenon, demonstrating the company's ability to create popular content that resonates globally [5][24] - The advertising business is seeing growth, with more than doubling of U.S. upfront commitments and higher rates of growth in programmatic advertising [12][14] Market Data and Key Metrics Changes - The company estimates it currently captures only about 7% of the addressable market in consumer spending and 10% of time spent on TV in its largest market, indicating substantial growth potential [4] - Total view hours grew faster in Q3 2025 compared to the first half of the year, achieving the highest quarterly view share ever in the U.S. and U.K. [17][18] Company Strategy and Development Direction - The company aims to continue focusing on profitable growth and reinvesting in its core business while embracing competition as a driver for improvement [4][32] - There is a strong emphasis on expanding original content and enhancing user engagement through interactive features and gaming [39][50] - The company is cautious about M&A, preferring organic growth and selective acquisitions that align with its strategic goals [32][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the health of the business and the opportunities ahead, despite challenges such as the Brazilian tax issue [2][10] - The company is excited about its upcoming content slate for Q4 and 2026, which includes returning popular series and new films [20][21] - Management believes that the shift from linear viewing to streaming will continue to benefit the company long-term [19] Other Important Information - The Brazilian tax matter is a unique gross tax on outbound payments, which has been flagged as a potential exposure in previous filings [8][10] - The company is exploring the integration of high-quality video podcasts into its offerings through a partnership with Spotify [22] Q&A Session Summary Question: Health of the business and future opportunities - Management believes the business is healthy and sees significant opportunities for growth ahead [2] Question: Nature of the Brazilian tax expense - The tax is a gross tax on outbound payments, not an income tax, and has impacted operating income for Q3 2025 [7][10] Question: Revenue and operating income growth for 2026 - Full year 2026 guidance will be provided in January, but the company aims to sustain healthy revenue growth and expand margins [11] Question: Advertising growth expectations - The company is excited about doubling ad revenue in 2025 and sees room for growth in programmatic advertising [12][14] Question: Engagement metrics and content performance - Total view hours grew in Q3 2025, with significant engagement from events like the Canelo Crawford fight and the K-pop film [17][18] Question: Strategy regarding M&A and industry consolidation - The company remains focused on organic growth and selective M&A opportunities, viewing industry consolidation as neither a threat nor a significant opportunity [32][33] Question: Impact of AI on content creation - Management sees AI as a tool to enhance creativity rather than replace it, focusing on leveraging AI for better storytelling and productivity [47][50]

Financial Data and Key Metrics Changes - The company reported revenue in line with expectations for Q3 2025, with operating income impacted by a Brazilian tax matter, which would have exceeded forecasts otherwise [2][16] - Engagement metrics remain healthy, achieving record share of TV time in both the US and the UK, with the highest quarterly view share ever recorded [3][26] Business Line Data and Key Metrics Changes - The advertising segment is on track to more than double ad revenue this year, with significant growth in programmatic advertising [3][20] - The company achieved its best ad sales quarter ever, indicating strong performance in the advertising business [3] Market Data and Key Metrics Changes - The company is currently capturing only about 7% of the addressable market in terms of consumer spending and 10% of time spent on TV in its largest markets, indicating substantial growth potential [5][6] - The Canelo Crawford fight was the most viewed men's championship fight this century, demonstrating the impact of live events on engagement [39] Company Strategy and Development Direction - The company focuses on continuous improvement in key areas such as technology and content to build a scalable global streaming business [4][10] - The strategy includes expanding original content and enhancing engagement through interactive features and gaming [62][63] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the health of the business and the opportunities ahead, emphasizing the importance of innovation and competition [2][5] - The company plans to sustain healthy revenue growth, expand margins, and increase free cash flow in the upcoming years [17][18] Other Important Information - The Brazilian tax matter is a unique gross tax on outbound payments, which has been recorded as a component of cost of revenues, affecting Q3 results [12][14] - The company is excited about upcoming content, including new seasons of popular shows and films, which are expected to drive engagement in 2026 [31][33] Q&A Session Summary Question: Can you talk broadly about the health of the business and the opportunity ahead? - Management believes the business is very healthy, with good progress on key initiatives and a lot of work ahead to fully realize opportunities [2] Question: Can you provide more color on the nature of the tax expense? - The Brazilian tax is a gross tax on outbound payments, not an income tax, and has been recorded as a cost of revenues affecting Q3 results [11][12] Question: Do you have any early views on revenue and operating income growth for 2026? - Full year 2026 guidance will be issued in January, but the financial objectives remain unchanged, focusing on healthy revenue growth and margin expansion [17][18] Question: Should we interpret the doubling of upfront commitments in advertising to mean that full year 2026 advertising could also double? - While the company is excited about the growth trajectory, specific 2026 guidance is not provided at this time [19][20] Question: Are fill rates improving in line with expectations as the Netflix ad suite and new demand partnerships scale up? - Fill rates have improved, and the company believes they will continue to improve as go-to-market capabilities develop [25] Question: Are you seeing a pickup in engagement as expected? - Total view hours grew faster in Q3 2025 than in the previous year, with significant engagement from key events and content [26][28] Question: How should we think about the recent deal with Spotify? - The partnership with Spotify aims to provide more entertainment options for members, integrating high-quality video podcasts into the Netflix offering [34] Question: Do you see potential industry consolidation reshaping the competitive landscape? - The company remains focused on organic growth and selective M&A, viewing industry consolidation as neither a threat nor a significant opportunity [50][56] Question: How do you think gaming could change the time members spend with Netflix each day? - Gaming is seen as a significant opportunity for engagement, with plans to expand interactive features and high-quality games [62][63]

Joining us now is Mark Mahaney from Evercore ISI. Mark, are you yet able to tell how much of this really is just about this Brazilian tax dispute. And that sounds like the kind of thing that really is a one-off and doesn't get to the fundamentals of the business.But is there something I'm missing there. >> I don't think you're missing anything. I think that sounds well maybe missing one thing there.This was a one-off. It's what 620 million charge. And so if you adjust for that, they would have handily beate ...

Netflix (Nasdaq: NFLX) reported Q3 earnings after the bell today. ...