Netflix beats forecast as earnings jump sharply

Netflix reported that its net income surged 82.7 percent year-on-year in the first quarter of 2026, driven in part by a $2.8 billion termination fee tied to a failed Warner Bros. transaction, according to its shareholder letter released late Thursday.

Revenue also increased 16.2 percent over the same period, News.Az reports, citing foreign media.

Revenue rose to $12.25 billion in the January–March quarter, compared with $10.54 billion a year earlier.

Net income climbed to $5.28 billion from $2.89 billion in the same period last year, while diluted earnings per share increased to $1.23 from $0.66. This exceeded Netflix’s forecast of $0.76 per share.

The company said the stronger results were supported by better-than-expected operating income and the $2.8 billion termination fee, which was recorded under interest and other income.

Revenue growth was also driven by membership gains, higher subscription prices, and increased advertising revenue.

Operating income rose 18 percent year-on-year to $3.96 billion, while operating margin improved to 32.3 percent from 31.7 percent.

Netflix projected second-quarter revenue of $12.57 billion, representing an expected 13.5 percent annual increase. It maintained its full-year 2026 revenue guidance in the range of $50.7 billion to $51.7 billion and kept its operating margin target at 31.5 percent.

In the same shareholder letter, Netflix also said co-founder Reed Hastings will not seek re-election to the board when his term expires at the annual meeting in June, as he plans to focus on philanthropy and other activities.

News.Az 

By Nijat Babayev