The sky isn’t raining for Netflix, but the streaming giant needs to convince investors it has a viable plan to maintain double-digit revenue and profit growth going forward.
The company on Thursday reported second-quarter results that were in line with Wall Street expectations, but its third-quarter revenue outlook was lower than expected. This raised concerns that Netflix’s engagement per user was slowing, indicating headwinds to subscription and advertising revenue growth. The company’s stock price fell to an 18-month low.
It doesn’t help allay the concerns: Netflix has announced that starting in 2027, it will release a massive viewership statistics report annually instead of semi-annually. Indeed, some investors were left wondering, “What is Netflix trying to hide?” Note that this comes after Netflix stopped reporting quarterly subscriber numbers last year as subscriber numbers began to level off.
Listening to Netflix, those concerns seem overblown. For example, the company said it would change to an annual data dump to “continue to focus on our key financial metrics: revenue and operating profit.”
Greg Peters, co-CEO of Netflix, said raw viewing numbers don’t tell the whole story. “There is not a linear relationship between watch time and revenue and profit because not all time is created equal,” he said on the second-quarter conference call.
According to Netflix, live programming outweighs the streamer’s weight in terms of viewing time. Netflix said that by 2026, live programming is expected to account for just over 5% of content spending (about $1 billion of the $20 billion in projected content spending), but only about 1% of viewing time. But over the past five years, live event programming accounted for six of the top 10 days of new membership (and Netflix notes that it didn’t start streaming live events until 2023). “So live events give us a lot of power in[subscriber]acquisition,” Peters said. “They’re good for monetization. They drive ad revenue, fandom.”
“Live content should take center stage in the future, as short viewing times can be overly effective in driving business if content is not repeatable,” MoffettNathanson analyst Robert Fishman said in a research note on Friday.
Live programming also plays a big role in Netflix’s booming advertising business. The company said pre-negotiations in the 2026 U.S. are “at an advanced stage and we expect to close commitments in the coming weeks.” Netflix says it’s seeing strong interest in its live programming lineup, including the 2027 FIFA Women’s World Cup, expanded NFL (two to five games next season), WWE, and MLB events.
Compared to Netflix’s other businesses, live events are a bright spot. Games introduced in late 2021 are still not working. And while the company’s video podcast efforts are in the relatively early stages, viewership numbers were clearly disappointing enough that Netflix didn’t feature the podcast title in its first half 2026 viewership report.
Meanwhile, Fishman said Netflix could also “counter bearish sentiment” among investors in other ways that don’t require huge investments. These include TV licensing partnerships (such as with France’s TF1) and possible bundling with other streaming services (such as NBCUniversal’s Peacock). The Wall Street Journal recently reported that Netflix is eyeing both areas. Fishman said Netflix could also launch a streaming “channel store” or a free ad-supported streaming TV (FAST) tier as it “gets serious” into the subscription business.
How is FAST moving? Asked about that in an earnings interview, Peters said the company “will continue to look at” free, ad-supported services, but there are no near-term plans to launch anything. “While free offerings may make sense in some markets, we need to consider the cannibalization of paid tiers,” he said, noting that “having an effectively scaled advertising business” is “clearly a key enabler for a functioning economy.”
Photo above: Snoop Dogg with real-life Huntr/x singers Audrey Nuna, Ije, and Ray Ami from Netflix’s “K-Pop Demon Hunters” at “Snoop’s Holiday Halftime Party” at U.S. Bank Stadium during the Vikings vs. Lions game on Wednesday, Dec. 25, 2025, in Minneapolis.
