Netflix reported third-quarter earnings per share above Wall Street estimates, with revenue in line. It expects full-year revenue of $51.1 billion, at the low end of its outlook and slightly below consensus, which it attributed to weaker ad revenue from a slower-than-expected rollout of ad product capabilities. The stock is down over 47% in the past year, and the main concern is user engagement as viewing habits shift. Co-CEO Greg Peters said U.S. engagement is solid but can be better, while engagement is strong in Asia-Pacific, Latin America and EMEA, and viewed hours in India grew 24% year over year. The article identifies AI and short-form content as the main overhang and cites Pershing Square's view that the market understates the cost of producing high-quality long-form video.
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