Why is Netflix stock sliding today?

Netflix Inc stock dropped 5.9% in after-hours trading after the streaming giant’s fourth-quarter revenue guidance of $13.4 billion came in below the analyst consensus of roughly $13.51 billion, despite reporting Q3 earnings per share of $0.87 that beat the $0.82 estimate and revenue of $12.87 billion that matched expectations.

The company also trimmed its full-year 2026 advertising revenue forecast to approximately $2.7 billion, down from the roughly $3 billion it had previously projected, blaming a slightly slower-than-expected rollout of ad product capabilities.

The earnings report landed against a backdrop of significant internal turbulence that had already pressured the stock heading into today’s print. Over the past week, Netflix cut approximately 1,000 jobs — about 6% of its total workforce, its largest reduction since 2022 — and replaced longtime content chief Bela Bajaria with former Disney executive Peter Rice, while film division head Dan Lin also departed. The company’s own shareholder letter acknowledged that "there’s some investor concern about our view hours growth," with analysts pointing to competition from YouTube and a content slate seen as weaker than prior years as factors dragging on engagement.

The broader U.S. market provided no cover for the decline. The S&P 500 gained 0.4% and the Nasdaq rose 0.7% during the regular session, meaning Netflix’s after-hours drop was entirely driven by company-specific factors rather than any macro headwind. The stock entered today’s report already trading near its 52-week low of $65.08, having shed roughly a quarter of its value year-to-date amid mounting engagement concerns and a series of analyst downgrades in recent weeks.

Taken together, a forward guidance miss on revenue, a reduced advertising outlook, and persistent questions about user engagement and content strategy combined to overwhelm what was otherwise a respectable quarterly result, sending shares to $64.64 in after-hours trading — a level that puts the stock within striking distance of its annual low.