Netflix announced its third-quarter 2025 earnings on Tuesday, highlighting its revenue results following its decision to stop regularly reporting subscriber data earlier this year.
The streamer reported adjusted EPS of $5.87 on revenue of $11.51 billion. Analysts expect Netflix to report third-quarter revenue of $11.51 billion and earnings per share (EPS) of $6.97, according to research firm LSEG Data & Analytics.
Netflix expected revenue of $11.5 billion (17% growth), EPS of $6.87 and operating margin of 31.5%.
Netflix explained the earnings miss in a letter to shareholders on Tuesday, writing: “Operating margin of 28% was below our guidance of 31.5% due to charges related to a dispute with Brazilian tax authorities that were not included in our forecast. Without this charge, we would have exceeded our operating margin forecast for the third quarter of 2025. We do not expect this matter to have a material impact on our future results.”
Netflix shares fell more than 6% in after-hours trading following the earnings release.
In a letter detailing its third-quarter results, Netflix said it “recorded its highest quarter of ad sales and doubled its pre-commitment in the U.S.,” but said it was “on track to more than double its ad revenue in 2025 (still on a relatively small base).”
Netflix said in the fourth quarter that it is “leveraging AI to test new ad formats, generate the most relevant ad creative and placements for our members, and rapidly develop media plans. These advances will enable us to test, iterate, and innovate dozens of ad formats by 2026.”
In July, Netflix raised its full-year 2025 revenue forecast to a range of $44.8 billion to $45.2 billion (previously $43.5 billion to $44.5 billion), or 15% to 16% year-over-year growth.
Netflix’s biggest win so far in the third quarter was the sudden success of the animated musical “KPop Demon Hunters.” It sustained the fandom through the current fourth quarter and continues to be a driver of Netflix viewership and box office revenue.
Ahead of Tuesday’s earnings call, Netflix announced it would re-release “KPop Demon Hunters” in theaters following an impressive first theatrical release this summer. This was prompted by the film’s growth in streaming charts after its June 20 platform debut. The streamer has also set up potentially lucrative merchandise deals with both Mattel and Hasbro for toys, dolls, games and more across the franchise.
In addition to “KPop Demon Hunters,” Netflix attributed its third-quarter performance to viewership of “Wednesdays,” Season 2, “Bon Appétit,” Korea’s “Her Majesty,” “Happy Gilmore 2,” and the Canelo-Crawford boxing match, which was the most-watched men’s championship fight of the century.
Netflix has suspended its practice of reporting total subscribers starting in the first quarter of 2025 (January to March). That means the last time Netflix publicly confirmed its overall subscriber numbers was back in January, when it reported that it would have 301.6 million paid streaming subscribers worldwide by the end of 2024.
Instead of subscriber numbers, Netflix is now focusing on revenue as its main metric for growth. Netflix said third-quarter sales were up 17% in the U.S. and Canada, 18% in Europe, the Middle East and Africa, 10% in Latin America and 21% in Asia Pacific.
(Top photo: Netflix’s “KPop Demon Hunters”)
