NEW YORK, January 21, 2026, 09:26 EST — Premarket
- Netflix shares fell about 7% in premarket trade, after ending Tuesday at $87.26. 1
- The streamer slightly topped quarterly estimates, but investors zeroed in on softer 2026 targets and a pause in share repurchases. 2
- Netflix is chasing Warner Bros Discovery’s studio and streaming assets in an $82.7 billion all-cash offer. 3
Netflix shares slid about 7% in premarket trading on Wednesday, extending the post-earnings drop as investors weighed a pause in share repurchases and the price tag of the company’s all-cash bid for Warner Bros Discovery assets. 1
The move matters because Netflix is trying to convince shareholders it can fund an $82.7 billion deal without blunting returns, at a moment when markets are already edgy after a sharp Wall Street selloff and ahead of U.S. President Donald Trump’s speech in Davos. 4
Netflix’s results did not fully calm nerves. The company reported quarterly revenue of $12.1 billion, modestly above analysts’ $11.97 billion estimate, while adjusted earnings per share came in at 56 cents versus expectations of 55 cents, according to LSEG data cited by Reuters. 2
Management leaned on growth in membership and viewing. Paid subscribers crossed 325 million in the quarter, and Nielsen attributed a December viewership lift to the final season of “Stranger Things” and two NFL games streamed on Christmas Day, Reuters reported. 2
Guidance did more damage than the quarter helped. Netflix forecast 2026 revenue of $50.7 billion to $51.7 billion, with the low end below analysts’ $50.98 billion estimate, and CFO Spencer Neumann told investors advertising revenue would reach about $3 billion. 2
The deal is the overhang. Netflix has shifted to an all-cash offer for Warner’s studio and streaming assets at $27.75 a share, and the Warner board backed the revised terms in a regulatory filing; Netflix said it expects a shareholder vote by April. 3
“This new agreement only ramps up the pressure,” Alex Fitch, a portfolio manager at Harris Oakmark, told Reuters, arguing the rival bidder now has to decide whether to come back with something better. 3
Netflix’s own financing choices are part of the pushback. The company said it would pause share buybacks — when a company repurchases its own stock — to accumulate cash for the transaction, and it has already incurred $60 million in costs tied to securing financing, Reuters reported. 2
It also raised more questions about leverage. Netflix said it had obtained commitments for a $59 billion bridge loan — short-term funding used to close a deal — and then increased that commitment by $8.2 billion to support the all-cash offer. 2
But the path is not clean. Reuters reported the deal is likely to face scrutiny from lawmakers and competition regulators, and Netflix’s executives spent the call defending why it needs Warner’s assets now after years of emphasizing organic growth. 5
The competitive dynamic is still live. Paramount Skydance is pursuing Warner as well, and its tender offer expires on January 21, setting up a near-term test of whether Netflix’s cash terms shut the door or invite another round. 3
For the session ahead, traders will watch whether Netflix stabilizes after the open and whether headlines on the Warner process — including any response from Paramount Skydance and the timetable for the April vote — shift the market’s focus back to streaming fundamentals. 4
