Full Breakdown
Netflix’s Growth Slows, Live Programming Gets a Push, and the Warner Bros. Bid Fades
By Drooid · · How we work
Core Event
At the Bloomberg Screentime conference in Los Angeles on September 30, Netflix co-chief executive Ted Sarandos said the streamer’s engagement grew only 2 percent in the first half of 2026 and that “overall, we’re not growing as fast as I want us to.” He pointed to live programming—about 5 percent of Netflix’s $20 billion annual content budget but generating roughly 1 percent of viewing—as a lever to improve sign-ups and reduce churn.
Background & Context
Netflix’s attempt to acquire Warner Bros. Discovery’s film and television studios, along with the HBO Max service, was abandoned after Paramount Skydance submitted a higher offer. A federal judge cleared the Paramount-Warner Bros. deal on September 30, ending Netflix’s bid. The failed acquisition has been cited as a factor that “threw the business narrative off” for investors.
Data & Statistics
- Engagement growth: 2 percent YoY in the first half of 2026 (multiple sources).
- Subscriber growth: 13.4 percent between April and June 2026, the lowest rate in nearly three years.
- Live programming budget share: ~5 percent of the $20 billion content budget.
- Live programming viewership share: ~1 percent of total watching hours.
- Share performance: down about 24 percent year-to-date, trading at roughly a 60 percent discount to the 10-year average price-to-earnings multiple.
Official Statements & Responses
Regarding the Warner Bros. He also noted that the shift to reporting engagement rather than subscriber numbers two years ago was “unsophisticated” but intended to focus on the quality of viewing.
Conflicting Reports & Gaps
Sources differ on the primary growth metric: some focus on subscriber growth (13.4 percent) while others emphasize engagement growth (2 percent). No source provides a unified view of how live programming will affect overall engagement beyond Sarandos’s qualitative statements. Additionally, the impact of the Warner Bros. bid on investor sentiment is described qualitatively, without quantified data on stock movement directly attributable to the failed acquisition.
Verbatim Quotes
- “Overall, we’re not growing as fast as I want us to, and we’re working on making that move faster,” — Ted Sarandos, netflix co-chief executive
- “The business is great and growing fine,” — Ted Sarandos, netflix co-chief executive
- “Netflix has become a show-me story because it is missing the mark on having real blockbuster, top-100-type shows, which is something that needs to be fixed lickety-split,” — Eric Clark, chief investment officer at Accuvest Global Advisors
- “I don’t think the concerns about competition are overdone, since everyone is fighting for the next bit of market share, but Netflix has a proven record of finding hits and moving into new growth areas like sports, podcasts and gaming,” — Gerald Sparrow, chief investment officer of the Sparrow Growth Fund
What’s Next
Netflix is slated to report third-quarter earnings in October, where analysts will look for signs of whether live programming and broader theatrical releases can lift engagement and stabilize the stock’s performance. The company also plans wider theatrical releases for upcoming titles such as *Narnia* and *Charlie and the Chocolate Factory* later in the year.
