Netflix trends down as layoffs, exec firings take toll

Is Netflix in another rut? That seems to be the case as execs are fired, growth slowed

Back in April 2022, this space reported that the honeymoon for Netflix was over, as the bloom fell off the rose for the streaming giant.

After a failed attempt to buy Warner Bros. Discovery, in which Netflix was outwitted and outplayed by Skydance’s David Ellison, it looks like they are in another down cycle with the announcement of some executive shakeups over the weekend and mixed third quarter earnings reports.

On Saturday, Netflix fired Chief Content Officer Bela Bajria, Head Of Film Dan Lin, and his second-in-command Doug Belgrad. This is on top of a recent layoff, where about one thousand employees – basically six percent of its global workforce –  were let go from the company as subscriber growth has slowed, viewer engagement isn’t what it used to be, and its stock price has become stagnant.

Former Fox and Disney exec Peter Rice has taken over the CCO role from Bajria.

Netflix released its third quarter earnings Tuesday and while they met Wall Street expectations, after hours trading showed their stock was down six percent due to a lower fourth quarter revenue outlook – one of the most lucrative as it includes the all-important holiday season and is important for retailers.

The streamer reported its beat its third quarter estimates (.87 per share opposed to .82) and hit their revenue estimates on-target with $12.87 billion as it was up twelve percent from last year. Net income was $3.66 billion (.87 per share), up from the 2025’s third quarter results. Netflix is forecasting its revenues to rise eleven percent in the fourth quarter, to $13.44 billion. The streamer has some marquee NFL games coming up, with a Thanksgiving Eve matchup between the Green Bay Packers and Los Angeles Rams, and a major tilt on Christmas Day, as those same Packers will meet Caleb Williams and the hated arch-rival Chicago Bears, which no doubt will drive subscriptions.

Netflix had to reduce its projections for fourth quarter revenue, which it expects to earn $51.1 billion, up thirteen percent from last year, but that’s on the low end on the Wall Street expectations scale. Netflix also had to adjust its ad revenue projection for 2026, with revenues now at $2.7 billion, down from its original projection of $3 billion.

The streamer coasted for years as the toast of the town as it changed the media world, making streaming a part of our lives with groundbreaking series such as Orange Is The New Black, Marvel’s dramas, Squid Game, Love Is Blind, and Stranger Things, which became a phenomenon. But newer streaming competition from Paramount, Disney, HBO Max, Peacock, Amazon Prime Video, FAST platforms (such as Pluto TV, Tubi, Xumo, etc.) and Google’s YouTube, has eaten away its market share.

Recent streaming hits – think Heated Rivalry, The Pitt, Love Island, and former Netflix property Daredevil – recently returning as Daredevil: Born Again –  were not on Netflix.

“With intense competition and an explosion of content competing for consumer attention, strategic clarity and excellent execution are critical,” Netflix said in a letter to shareholders Tuesday. “In Q3, we delivered well across all three priorities, but we see room to do even better with focused, continuous improvement.”

“We know there’s some investor concern about our view hours growth,” the letter went on to say. “[E]ngagement — which encompasses quantity, quality and variety of viewing — remains healthy and … we continue to deliver strong value to members.”

In the last few years, Netflix started doing what everyone else was doing – adding ad tiers, striking deals in France to carry linear broadcaster TF1 in that country, and sports such as WWE Raw, the 2027 Women’s World Cup, and the MLB and the NFL. The streamer was blasted for its slipshod production of boxing and the opening night game in March between the New York Yankees and San Francisco Giants and the Home Run Derby – given the perception that Netflix practically prints money.

Netflix also recently became an exclusive home for a few video broadcasts, such as top-rated radio show The Breakfast Club. 

Another matter is the way has Netflix has recently treated talent, with tensions rising between them and Hollywood’s creative community over budgets. Lin’s hiring two years ago was meant to streamline production and aggressively cost-cut but in the process, he alienated many top-tier actors and writers, including Ben Affleck.

Despite the turmoil, Netflix still has some must-see programming such as Wednesday (based on the character from The Addams Family), Hunting Wives, and KPop Demon Hunters, which has spawned tons of merchandise. But the streamer has not produced anything on the level of Stranger Things in terms of being a big cultural talking point.

While Netflix is still an successful streamer, they must come to grips that they are not the only game in town anymore. With Skydance now in control of Paramount + and HBO Max and Ellison’s plan to combine both services in a few years, the competition has never been tougher. Can Netflix meet the challenge? The media industry – and Wall Street – will be watching.