Netflix reported Q4 revenues of $12.05 billion, an 18% increase year-over-year, while operating income climbed 30% to $2.96 billion, driving the operating margin up to 24.5%. The company ended 2025 with 325 million paid subscribers and generated free cash flow of $9.5 billion, exceeding its guidance of $9 billion.

For 2026, Netflix forecasts revenues between $50.7 billion and $51.7 billion, reflecting 12%–14% growth, and targets a 31.5% operating margin that factors in roughly $275 million of acquisition-related expenses tied to its pending Warner Bros. and HBO deal. The company has paused its share buyback program, having repurchased $2.1 billion in shares during Q4, to preserve cash for these investments.

Disney has taken an opposing approach by actively reducing content costs as it shifts focus toward improving streaming profitability. This cost discipline highlights a different path from Netflix’s front-loaded investment cycle and underscores Disney’s emphasis on franchise depth over volume expenditure.