Netflix Shares Fall Over 5% on Soft Engagement, Slowing Revenue Growth

Netflix shares fell more than 5% on Tuesday after quarterly earnings failed to ease investor concerns over slowing viewer engagement and revenue growth. The company said in its investor letter that it is "confident" it can accelerate view-hour growth despite acknowledged concerns. For the third quarter ending in September, Netflix reported $12.87 billion in revenue and $3.7 billion in net income, both above FactSet expectations. It did not disclose overall subscriber view hours, noting only that the metric rose 24% year-over-year in India. The company stopped reporting subscriber numbers in the first half of 2025. Portfolio manager John Belton of Gabelli Funds cited concerns about soft engagement, decelerating revenue growth, slower margin expansion, and recent content leadership changes. Netflix reportedly plans to cut about 6% of its workforce, roughly 1,000 jobs, and recently replaced chief content officer Bela Bajaria with former Disney executive Peter Rice. Co-CEO Ted Sarandos said the company needs "better execution in the US," while content outside the US is "largely working." Netflix also missed expectations on advertising revenue growth.