Netflix reported fourth-quarter revenue of $12.05 billion, up 18% year-over-year, and net income of $2.4 billion, or $0.56 per share, both ahead of consensus estimates. Despite this beat, the company’s share price fell by roughly 4% on the day of the release and remains down 10% since the start of the year, reflecting growing investor unease.

On December 5, 2025, Netflix initiated an $82.7 billion all-cash bid for Warner Bros. Discovery’s studio and streaming assets. The bid escalated into a hostile contest when a rival suitor offered competing terms, driving up acquisition costs. Investors have flagged potential integration difficulties, heightened leverage and regulatory scrutiny as key risks that could overshadow Netflix’s operational strengths.

The platform ended 2025 with 325 million paid members, an 8% increase year-over-year, driven in part by the global debut of its flagship series which attracted 120 million unique viewers in its first month. Advertising revenue doubled to $1.5 billion in 2025 and is expected to double again in 2026, positioning the ad-supported tier as a critical growth engine that supplements the slowing core subscriber expansion.

Management forecasted 2026 revenue growth of 12%–14%, implying full-year sales between $50.7 billion and $51.7 billion, with operating margins expanding to approximately 31.5%. These projections fell slightly below prior-year growth rates, prompting questions about valuation. At current multiples near 27 times forward earnings, analysts debate whether the stock adequately reflects both its mature streaming business and the hefty gamble on the Warner Bros. transaction.