In the third quarter of 2025, Netflix reported revenues of USD 11.5 billion, in line with analysts’ expectations. Operating income reached USD 3.24 billion — around USD 400 million below forecasts. Net earnings per share came in at USD 5.87 versus the expected USD 6.94. At the same time, the company generated USD 2.66 billion in free cash flow, outperforming market estimates.
The weaker bottom-line result was mainly due to a one-off tax charge in Brazil amounting to USD 619 million, related to an ongoing tax dispute dating back to 2022. Netflix emphasized that excluding this expense, the quarterly figures would have exceeded analyst expectations. Following the earnings release, the company’s share price dropped by 7.5%. It is worth noting that Netflix stock reached an all-time high of USD 1,341.15 in June before beginning to lose momentum.
Operationally, Netflix delivered record levels of user engagement. Among the most-watched titles during the quarter were KPop Demon Hunters, the second season of Wednesday, the continuation of Happy Gilmore, and the Alvarez vs Crawford boxing showdown. In the fourth quarter, the platform plans to release the final season of Stranger Things, a new installment of the Knives Out franchise, as well as films directed by Guillermo del Toro and Kathryn Bigelow.
The company forecasts full-year free cash flow of around USD 9 billion. These funds are expected to be allocated toward share buybacks, investments in new content, and potential acquisitions — including assets from Warner Bros. Discovery, although Netflix underlines that such acquisitions are not essential to its long-term strategy.
Despite strong operating performance, investors express concern about the lack of growth in total viewing time per user. Additional risks include intensifying competition from free, ad-supported platforms such as YouTube, Roku and Tubi, as well as the potential market disruption caused by AI-generated content.
Krzysztof Kamiński – OANDA TMS
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