The Netflix story: Job cuts, exits, sinking stock, and the battle for viewership. A plot twist that isn't on screen

The Netflix saga gets an unexpected plot twist this year. From 'Stranger Things' happening inside the organisation to 'The Crown' passing to a new guard, from 'Up' to 'Below', when will the streaming 'Giant' chill again?

Marking a multi-year slowdown in its core expansion, Netflix, the streaming giant, failed to gain net subscribers in any month this year in the US, as per Antenna (an analytics firm that tracks U.S. consumer purchases of subscriptions), with its stock falling 25% since 2026 beginning and laying off about 6% of staff this month. The reasons behind the downfall are reportedly lower subscriber and viewing-hour growth.

October saw a lot of leadership shaking and job-cutting in the organization. On October 16, Netflix fired its chief content officer, Bela Bajaria. On October 19, Netflix laid off its head of the film division, Dan Lin, followed by film VP Doug Belgrad. Before that, the company eliminated 1,000 employees.

Where's the money

Netflix released its third-quarter earnings report on October 20. The release was followed by stocks plummeting about 6% in after-hours trading on Tuesday. The company's net income rose 44% year-over-year to $3.66 billion, which is $0.87 per share (5 cents) above expectations.

Reported revenue was $12.87 billion, in line with consensus, marking a 12% increase compared to the previous year. Netflix reduced its 2026 ad revenue targets from $3 billion to $2.7 billion. The fourth-quarter projection for its revenue stood at $13.44 billion, which is $70 million below the consensus analyst estimate of $13.51 billion.

ALSO READ: AI's hidden power problem: 'Weeteq' claims to cut the electricity wasted inside data centres, here's how

Netflix viewership

Netflix's television screen watch time has slipped to 7.8% in the United States, which is almost half of YouTube's 14.2%.

In the US, adults spend 93 minutes per day (average) on Netflix and almost 95 minutes per day (average) on the TikTok app, according to The Battenhall Weekly report.

In comparison to 2025, Netflix devoted 10% more to content, which is about $20 billion. CFO Spence Neumann said during the third-quarter earnings call that they would give a 2027 financial outlook in January.

Netflix's own Glass Onion moment

Former Disney TV and 21st Century Fox head Peter Rice succeeds Bela Bajaria, joining the office on October 26, 2026. With his extensive experience in TV, film, and sports, Rice will supervise this multi-billion-dollar content budget while serving as CCO at Netflix.

Pagesix wrote, "Bajaria was asked by the streamer to conduct some of the layoffs, not knowing she’d be next on the chopping block and that her replacement was lined up to be announced, we hear."

"Multiple sources around town said on Thursday they thought Bajaria was a “scapegoat” for Netflix’s financial woes, especially after its failed attempted acquisition of Warner Bros," the celebrity gossip column reported further.

Behind the scenes

Wall Street Journal writes, "Netflix’s stock has sagged since its failed bid launched last year for Warner Bros. Discovery’s film and TV studios and HBO Max, which investors saw as a sign of weakness for a company whose leaders long said they were builders, not buyers. Its stock is down more than 40% from a year ago, around the time the acquisition pursuit began."

Netflix stopped disclosing its subscriber numbers in 2025, and Antenna's further claims that the company had not added net subscribers this year raise concerns about its viewer growth.

Netflix reported double-digit percentage revenue growth in every region in its Q2 2026 report. New categories such as live sports have been more successful than video games. According to a recent internal memo cited by WSJ, only 3.5% of Netflix’s subscribers play games monthly. It is also reported that Netflix is performing about 10% below its targets for audience reach and engagement in 2026

Are subscribers watching less because the company is producing or acquiring shows and movies that aren't interesting enough? Or is the content actually good, but the company's recommendation algorithm is failing to suggest the right shows to the right viewers? The sword of blame is still dangling between the content team in Los Angeles and the tech team in Northern California.

ALSO READ: Heating bills may rise 21% for some US homes, while others could pay less. Who will feel the heat this winter?

FAQs

1. What has contributed to Netflix's recent decline in subscriber growth?
   Netflix has experienced a multi-year slowdown in subscriber growth, reportedly due to lower viewing-hour growth and a lack of new net subscribers in the US this year.
2. What were the financial results of Netflix's third-quarter earnings report?
   In its third-quarter earnings report, Netflix reported a net income of $3.66 billion, marking a 44% year-over-year increase, and reported revenue of $12.87 billion, which reflects a 12% increase compared to the previous year.
3. What changes have occurred in Netflix's leadership recently?
   Recently, Netflix has seen significant leadership changes, including the firing of chief content officer Bela Bajaria and head of the film division Dan Lin, as well as a substantial reduction of approximately 1,000 employees.