Netflix Beats Q1 Earnings, Shares Slide On Soft Guidance, Co-Founder Exit

benzinga_article
2026.04.17 00:31

Netflix reported Q1 2026 earnings with revenue of $12.25 billion, exceeding expectations of $12.18 billion. Earnings per share reached $1.23, surpassing the estimated 76 cents. The company experienced a 16% year-over-year revenue increase, driven by membership growth and higher pricing. Operating cash flow was $5.3 billion, up from $2.8 billion last year, with free cash flow at $5.1 billion. Despite strong results, Netflix shares slid due to soft guidance and the exit of a co-founder, prompting investors to monitor the stock closely.

Netflix Inc (NASDAQ:NFLX) reported financial results for the first quarter of 2026 after the market close on Thursday. Here’s what you need to know from the streaming giant’s report.

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Netflix Q1 Earnings Highlights

Netflix reported first-quarter revenue of $12.25 billion, beating analyst estimates of $12.18 billion, according to Benzinga Pro. The company reported earnings of $1.23 per share for the quarter, beating estimates of 76 cents per share.

Total revenue was up 16% year-over-year in the first quarter, driven primarily by membership growth, higher pricing and increased ad revenue. Revenue was above company expectations due to stronger membership growth.

Cash generated from operations was $5.3 billion in the quarter, up from $2.8 billion year-over-year. Free cash flow came in at $5.1 billion. Netflix exited the quarter with $12.3 billion in total cash and cash equivalents, and $14.4 billion of gross debt.

“We're optimistic about the future of entertainment and our long runway for growth, and are focused on three areas to achieve our ambition,” the company said in a letter to shareholders.

Netflix said it will focus on delivering more entertainment value, using technology to improve the business and improving monetization.

What’s Next For Netflix?

Netflix guided for second-quarter revenue of $12.57 billion versus estimates of $12.63 billion. The company anticipates second-quarter earnings of 78 cents per share versus estimates of 84 cents per share. The soft guidance for the second quarter appears to be weighing on shares after hours.

“We expect Q2 to have the highest year-over-year content amortization growth rate in 2026, before decelerating to mid-to-high single-digit growth in the second half of the year,” the company said.

Netflix also affirmed its full-year outlook for revenue of $50.7 billion to $51.7 billion, versus estimates of $51.38 billion.

Finally, Netflix announced that chairman and co-founder Reed Hastings will not stand for re-election to the board when his term expires in June.

Netflix executives will further discuss the quarter on an earnings call with investors and analysts at 4:45 p.m. ET.

NFLX Shares Fall After The Close

NFLX Price Action: Netflix shares were down 9.68% in after-hours, trading at $97.35 at the time of publication on Thursday, according to Benzinga Pro.

Read Also:Netflix Q1 Preview: Streamer Can 'Focus On Growing' After Walking From Warner Bros. Deal, Expert Says

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