Netflix reported 325 million paid subscribers at the end of 2025, with churn at 2%, the lowest in the industry. In the third quarter, revenue rose 12% year over year, operating margin expanded from 28.2% to 34.6%, and EPS reached $0.87. This week, however, Netflix fired its content head and film unit head and laid off 1,000 workers, as revenue growth slowed to its lowest in three years amid weakness in the U.S. business. The company hired Disney alumnus Peter Rice to produce a major hit show and slightly lowered full-year revenue growth guidance to 13%, citing a delay in an ad product rollout. The stock is down 46% over the past year, with a P/E of 19. The author argues Netflix has not hit a wall and can rebound.
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