New York, Jan 21, 2026, 04:51 EST — Premarket
- Netflix shares slipped roughly 1.1% in premarket action after the streamer reported a slight earnings beat but warned of rising deal-related expenses.
- Investors are zeroing in on Netflix’s all-cash bid for Warner Bros Discovery assets and the halt in share buybacks.
Netflix shares dipped in premarket trading Wednesday, sliding further after its earnings beat. Investors remain cautious, balancing the strong results against the $82.7 billion bid for Warner Bros Discovery assets.
The deal is stealing the spotlight. Netflix’s fourth-quarter results beat estimates, yet the focus has shifted to financing, regulatory hurdles, and the possibility of higher costs if a rival bidder jumps in.
This is significant because Netflix has relied on strict cost control and buybacks to bolster both margins and its share price. A major cash acquisition changes that approach—at least for now—and shifts traders’ focus away from quarterly earnings.
Netflix shares traded in Frankfurt dropped roughly 7% during early European hours, following a 0.8% decline at Tuesday’s U.S. close, Reuters reported. (Reuters)
Netflix posted $12.1 billion in revenue for the October-to-December quarter, slightly beating the $11.97 billion consensus, with adjusted earnings at 56 cents per share versus the expected 55 cents, according to LSEG data cited by Reuters. Paid subscribers climbed above 325 million. Michael Ashley Schulman, CIO at Running Point Capital Advisors, noted the company has “not shied away” from strategies focused on long-term growth, even if the stock initially reacts negatively. (Reuters)
Netflix projected 2026 revenue between $50.7 billion and $51.7 billion, with the lower bound falling short of Street estimates, Reuters reported. The firm said this forecast is based on ad revenue roughly doubling. CFO Spencer Neumann told investors ad sales should hit around $3 billion. (The advertising figure relates to Netflix’s ad-supported tier, where it sells commercial time.)
The company’s outlook emphasized more live programming and fresh formats. Co-CEO Ted Sarandos highlighted plans to broaden live events beyond the U.S., such as the World Baseball Classic in Japan. At the same time, co-CEO Greg Peters mentioned that Netflix is expanding its ad offerings, adding interactive video ads, Reuters reported.
Still, the Warner bid took center stage. Netflix switched gears, now offering $27.75 a share all in cash, with Warner’s board endorsing the updated terms in a regulatory filing. To back the cash bid, Netflix secured a $59 billion bridge loan — a short-term financing deal — and boosted that by $8.2 billion, Reuters reported. Alex Fitch, portfolio manager at Harris Oakmark, said the move “ramp[s] up the pressure,” forcing the rival bidder to act fast. (Reuters)
Netflix announced it will halt share buybacks—its usual practice of repurchasing stock—to conserve cash for the deal. This cuts off a reliable source of demand for the shares just as investors weigh the logic of the acquisition price.
The competitive landscape remains tight. Paramount Skydance’s tender offer was due to expire on Jan. 21, while Warner shareholders are slated to vote on the Netflix deal by April, Reuters reported. The stock’s moves continue to hinge as much on news flow as on fundamentals.
This could easily backfire. A higher counteroffer might push Netflix to improve its terms, while regulators wary of media consolidation could delay approvals or impose restrictions. On top of that, any slowdown in subscriber growth would only make the financing more burdensome.
Traders will be looking to see if the stock holds steady at the U.S. open and if Paramount takes any further action before its offer deadline. The next significant milestone comes with the timing and terms of a Warner shareholder vote, expected by April.
