Guidance
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FY2026 Q1
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Netflix, Inc. earnings call
Buzzberg read
Netflix maintains 2026 guidance with 12-14% revenue growth.
Netflix reported strong Q1 2026 momentum and maintained full-year guidance of 12-14% revenue growth and 31.5% operating margin. Management discussed the failed Warner Bros. acquisition as a disciplined walk-away, highlighted the World Baseball Classic's outsized subscriber impact in Japan, and noted expanded sports rights discussions with the NFL. The ad business is on track to double to $3B. Full-year 2026 guidance maintained: revenue +12-14%, operating margin 31.5%, ads revenue ~$3B.
Buzzberg read Netflix maintains 2026 guidance with 12-14% revenue growth. Netflix reported strong Q1 2026 momentum and maintained full-year guidance of 12-14% revenue growth and 31.5% operating margin. Management discussed the failed Warner Bros. acquisition as a disciplined walk-away, highlighted the World Baseball Classic's outsized subscriber impact in Japan, and noted expanded sports rights discussions with the NFL. The ad business is on track to double to $3B. Full-year 2026 guidance maintained: revenue +12-14%, operating margin 31.5%, ads revenue ~$3B. Read full analysisCollapse analysis
Netflix reported strong Q1 2026 momentum and maintained full-year guidance of 12-14% revenue growth and 31.5% operating margin. Management discussed the failed Warner Bros. acquisition as a disciplined walk-away, highlighted the World Baseball Classic's outsized subscriber impact in Japan, and noted expanded sports rights discussions with the NFL. The ad business is on track to double to $3B. Full-year 2026 guidance maintained: revenue +12-14%, operating margin 31.5%, ads revenue ~$3B.
- Q1 member quality metric hit another all-time high, and view hours grew at similar rates to H2 2025 despite Winter Olympics competition.
- Warner Bros. acquisition was abandoned due to cost exceeding value; Netflix built M&A muscle without losing focus on core business.
- World Baseball Classic drove record sign-up day in Japan and helped APAC become the strongest FX-neutral revenue growth region.
Revenue$12.2498B+2% QoQ
EPS$1.23Reported
Gross margin51.93%Reported
Operating margin32.3%Reported
6 grounded callouts
What matters now
The highest-signal changes from the call.
Advertising
Advertising business expected to double to about $3 billion.
Engagement
Member quality metric hits another all-time high in Q1.
Show 3 more callouts
Content
World Baseball Classic drove record sign-ups in Japan.
M&A
M&A discipline tested and affirmed after WB deal walk-away.
Gaming
Netflix Playground app targets kids' games as growth area.
Reported period
Actuals
| Metric | Reported | Change |
|---|---|---|
| Revenue | $12.2498B | +2% QoQ |
| EPS | $1.23 | Reported |
| Gross margin | 51.93% | Reported |
| Operating margin | 32.3% | Reported |
| Free cash flow | $5.0941B | Reported |
| Capex | $0.1961B | Reported |
Forward-looking
Forward guidance
| Metric | Period | Range | Midpoint | Status |
|---|---|---|---|---|
| Operating margin | FY2026 | 31.5% | 31.5% | Maintained |
| Revenue | FY2026 | 12%–14% | 13% | Maintained |
| RevenueADS | FY2026 | $3B | $3B | Initiated |
AI, capex & demand read
Management read
Confident
Management expresses confidence in growth prospects, citing strong Q1 results, record engagement metrics, and successful content investments, while maintaining guidance.
Management AI read
Management views GenAI as a tool to improve content creation and member experience, with the Interpositive acquisition accelerating capabilities. They see opportunities in personalization, ad tech, and production, and noted early engagement gains from AI-driven recommendation systems.
all 5 named companies below
Companiesreturns since call
Partners
Partners
Ted Sarandos
Sony's films remain a key content pipeline for Netflix, supporting Sony's licensing revenue stream.
Evidence
“We have a pay-one deal with Sony.”
Partners
Ted Sarandos
Netflix is in active discussions to expand its NFL relationship, potentially adding more regular-season or playoff packages, which would intensify competition for premium sports rights. — Increased demand from Netflix for NFL rights could drive up prices for all bidders and shift the sports broadcasting landscape, impacting Disney (ESPN), Comcast (NBC Sports), and Warner Bros. Discovery (TNT Sports).
Evidence
“We have it with NBCUniversal that includes DreamWorks Animation and Illumination.”
Suppliers
Suppliers
Ted Sarandos
Paramount's licensing deals with Netflix provide steady revenue and help keep Paramount's content in front of a large audience, but also reduce incentive for Paramount to retain exclusive content.
Evidence
“We license shows like Watson and Mayor Kingstown from Paramount.”
Supply chain
Supply chain
Ted Sarandos
Netflix is in active discussions to expand its NFL relationship, potentially adding more regular-season or playoff packages, which would intensify competition for premium sports rights. — Increased demand from Netflix for NFL rights could drive up prices for all bidders and shift the sports broadcasting landscape, impacting Disney (ESPN), Comcast (NBC Sports), and Warner Bros. Discovery (TNT Sports).
Evidence
“The NFL is a great property and it delivers value as part of our total offering. We are in discussions right now because we think there's an opportunity to expand the relationship.”
External signals
Supply-chain alpha · 1returns since call
Netflix is in active discussions to expand its NFL relationship, potentially adding more regular-season or playoff packages, which would intensify competition for premium sports rights.
Methodology & coverage
Management-only analysis. All 5 validated company mentions are shown. Reported actuals and forward guidance are kept separate. Public evidence is limited to eight short attributed quotes. AI-generated analysis can be incomplete or wrong; verify important claims against the original source.