Netflix beats Q3 EPS but guides Q4 below consensus, cuts 2026 ad forecast; shares fall ~5% after hours (Oct 20)
What happened
Netflix reported Q3 2026 results after the close on Tuesday: EPS of $0.87 beat the ~$0.82 consensus (FactSet), while revenue of $12.87 billion was in line with expectations and up ~12% year over year. The stock fell anyway — down roughly 4-7% in after-hours trading — because guidance disappointed: Q4 net income is forecast at $2.79 billion / EPS of $0.67, below consensus of $3.07 billion / $0.73, and the company cut its 2026 advertising revenue forecast to about $2.7 billion from $3 billion, saying some ad product capabilities rolled out slower than expected. Management said it will keep expanding via third-party content licensing and focus on core streaming TV, film, live events, and originals that 'spark conversation.'
Why it matters & what’s next are part of Pro, along with the audio summary.
Start your free 14-day trialWho’s affected
- Netflix (NFLX) — shares fell roughly 4-7% in after-hours trading on the Q4 guide-down and ad-forecast cut
- Walt Disney (DIS) and streaming peers (Skydance SKYD) — heightened scrutiny on streaming growth and engagement trends sector-wide
- Alphabet (GOOGL) — YouTube cited as key viewing-hours competition; rotation arguments into YouTube vs Netflix surfaced post-print