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(Sharecast News) - Streaming giant Netflix traded lower in extended trading after its thirdquarter outlook came in shy of Wall Street expectations, with softerthanhoped engagement trends also weighing on sentiment.
Netflix said secondquarter earnings had come in at $0.80 per share, a single cent ahead of estimates, while revenues of $12.56bn were up 13.4% yearonyear but just short of the $12.58bn consensus and short of the 16.2% pace seen in Q1.
For the third quarter, Netflix guided to revenues to $12.86bn versus expectations of $13bn, and EPS of $0.82, below the $0.84 analysts had pencilled in. Fullyear 2026 revenue guidance of $51bn to $51.4bn was also reiterated.
Regionally, Netflix's US and Canada segment grew 10% yearonyear, a slowdown from recent quarters, while Latin America was the only region to see growth accelerate. View hours reached a record 97bn in the first half, up 2%, despite competition from the Winter Olympics and World Cup.
Netflix said it remained on track to deliver $3bn in ad revenue this year, citing strong advertiser interest in live events across football, baseball, wrestling and the Women's World Cup.
Free cash flow fell to $1.5bn from $2.3bn, with the company pointing to higher cash tax payments, partly linked to the $2.8bn breakup fee received from Paramount Skydance after losing out on the Warner Bros Discovery bid.
As of 0940 BST, Netflix shares were down 9.05% in pre-market trading at $67.62 each.
Reporting by Iain Gilbert at Sharecast.com
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