Netflix shares fall after weaker fourth-quarter and ad outlook

Netflix reported stronger-than-expected third-quarter results on October 20, but its forecast of slower fourth-quarter revenue growth and a lower advertising outlook sent its shares down in after-hours trading. The company reported $12.87 billion in revenue, up about 12% from a year earlier, and earnings of 87 cents per share, above analysts’ expectations. Its fourth-quarter revenue forecast of $13.4 billion fell short of expectations, overshadowing the quarterly results. Netflix also lowered its expected 2026 advertising revenue to about $2.7 billion, from a previous forecast of $3 billion. The company attributed the revision partly to a slower-than-expected rollout of advertising capabilities. It projected full-year revenue of $51.1 billion, representing 13% growth and the lower end of its previous guidance range. The company’s third-quarter net income was about $3.7 billion. It forecast fourth-quarter profit of $2.8 billion, or 67 cents per share, and said costs associated with recent workforce reductions would weigh on its operating margin. Netflix shares fell more than 5% in after-hours trading Tuesday, with reports the next morning describing a decline in premarket...