Netflix Inc (NASDAQ:NFLX, XETRA:NFC) reported first quarter financial results that topped Wall Street expectations, with stronger-than-anticipated revenue and earnings driven by membership growth, pricing adjustments, and expanding advertising income.
However, weak second quarter guidance saw the streaming platform's shares fall 9% afterhours. It guided revenue of $12.57 billion, which fell short of the $12.63 billion expected.
Looking ahead, the company left its full-year 2026 guidance unchanged. Netflix continues to forecast revenue between $50.7 billion and $51.7 billion, representing growth of 12% to 14%.
Growth is expected to be supported by ongoing membership gains, pricing actions, and an anticipated near doubling of advertising revenue. The company is also targeting a full-year operating margin of 31.5%, compared with 29.5% in 2025.
The company noted that content amortization growth will be weighted toward the first half of the year due to the timing of major title releases, with margin expansion expected to resume in the second half to meet full-year targets.
For the first quarter, Netflix posted revenue of $12.25 billion, slightly above analyst estimates of $12.18 billion. Revenue rose 16% year over year (14% on a foreign-exchange neutral basis), with the company attributing growth primarily to increased membership, higher pricing across markets, and continued expansion of its advertising-supported tier.
Earnings per share came in at $1.23, well ahead of consensus estimates of $0.78 and significantly higher than $0.66 in the same period last year. The company said results were boosted by stronger-than-forecast operating income and a $2.8 billion termination fee related to the previously discussed Warner Bros transaction, which was recorded in interest and other income.
Additionally, Netflix announced that Reed Hastings, one of its co-founders and chairperson, will not stand for re-election to the company's board to focus on philanthropy and other pursuits.
“Netflix changed my life in so many ways, and my all‑time favorite memory was January 2016, when we enabled nearly the entire planet to enjoy our service," he said in a statement. "My real contribution at Netflix wasn’t a single decision; it was a focus on member joy, building a culture that others could inherit and improve, and building a company that could be both beloved by members and wildly successful for generations to come."