Netflix reported better-than-expected first-quarter 2026 results on April 16, posting $12.25 billion in revenue — a 16.2 percent year-on-year increase — and diluted earnings per share of $1.23, nearly double the prior year. But shares fell 9 percent in after-hours trading after the company’s second-quarter revenue guidance disappointed Wall Street. The same day, co-founder Reed Hastings announced his resignation from Netflix’s board of directors.
The numbers
Revenue of $12.25 billion came in ahead of the analyst consensus of $12.18 billion. Net income for the quarter was $5.3 billion. Free cash flow reached $5.1 billion — a figure that reflects Netflix’s growing profitability and ability to fund both content and share buybacks from operations. Diluted EPS of $1.23 significantly outpaced the consensus estimate of $0.76.
Revenue growth by region: US and Canada up 14 percent to $5.2 billion; Europe, Middle East and Africa up 17 percent to $4 billion; Latin America up 19 percent to $1.5 billion; Asia-Pacific up 20 percent to $1.3 billion.
The Q2 guidance miss
Despite the strong Q1, Netflix’s Q2 revenue growth forecast of 13 percent fell short of analyst expectations. Netflix reiterated its full-year 2026 revenue guidance of $50.7 billion to $51.7 billion — but markets had priced in either an upward revision or stronger Q2 guidance. The shortfall, compounded by a soft advertising revenue outlook, triggered the after-hours sell-off.
Reed Hastings exits the board
Reed Hastings, who co-founded Netflix in 1997 and led it for 25 years as CEO before transitioning to executive chairman in January 2023 and stepping back entirely in 2024, announced his resignation from Netflix’s board effective immediately. Hastings did not give a public explanation. He remains Netflix’s largest individual shareholder. His departure ends a 28-year formal association with the company he created, and marks the symbolic close of Netflix’s founder era.
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