Netflix Exits Warner Bros Discovery Auction, BoA Forecasts $51.3B 2026 Revenue
Netflix withdrew from the Warner Bros Discovery auction to refocus on organic growth, content spending, ads and international shows. Bank of America forecasts 2026 revenue of $51.3 billion (up 13%), operating margin of 31.5%, free cash flow of $11.3 billion and cuts its price target to $125.
1. Netflix Exits Warner Bros Bid
Netflix withdrew from the bidding process for Warner Bros Discovery’s studio and streaming assets after Paramount Skydance’s superior offer, describing the assets as “nice to have” rather than essential.
2. Strategic Refocus and Growth Drivers
With the Warner Bros deal behind it, Netflix is prioritizing organic member growth, boosting content investment and expanding its advertising business. Growth engines include live events, sports, podcasts, international programming, vertical mobile video and gaming initiatives.
3. Bank of America Forecast and Rating
Bank of America updated its 2026 revenue forecast to $51.3 billion (13% year-over-year growth), projecting a 31.5% operating margin and $11.3 billion in free cash flow. The firm maintained a Buy rating but lowered its price objective from $149 to $125.
4. Market Implications
Despite peer multiple compression, Netflix’s global scale, strong brand and diverse growth drivers are expected to sustain its outperformance. Penetration below 50% in connected TV households signals significant room for subscriber expansion.