Netflix approves a $25 billion share repurchase program following a 10% decline in its stock.

      The $25 billion share repurchase program has no expiration date and is in addition to a December 2024 authorization that retained $6.8 billion. Netflix's board approved this program on April 22. Following the announcement, shares increased by 1.5% in premarket trading, having previously fallen by as much as 10.8% after the Q1 earnings report on April 16.

      On April 22, 2026, Netflix's board authorized a $25 billion share buyback program, which also has no expiration date, as per a regulatory filing made the next day. This new authorization supplements a buyback approved in December 2024, which still had $6.8 billion available for purchases as of March 31.

      Bloomberg indicated that the buyback comes in response to a “disappointing financial outlook” that caused shares to drop, declining by approximately 9–10% in after-hours and premarket trading right after the company's Q1 earnings release on April 16. On April 23, shares rose by 1.5% in premarket trading following the buyback announcement.

      The Q1 earnings report was a mixed bag, typical for Netflix: strong headline figures but pressure from guidance going forward. Revenue rose by 16% year-over-year to $12.25 billion, surpassing the analyst consensus of $12.18 billion. Earnings per share reached $1.23, significantly higher than the $0.76 forecasted by Netflix, but this figure was largely boosted by a one-time termination fee of $2.8 billion received after backing out of a proposed acquisition of Warner Bros. Discovery’s streaming and studio assets. Excluding this fee, the underlying EPS from operations was about $0.58, with paid memberships exceeding 325 million worldwide.

      The ad-supported tier achieved 190 million monthly active viewers across 12 countries, aiming to nearly double its ad revenue to around $3 billion for the entire year.

      The context of the termination fee is crucial. Netflix had initially offered around $82–83 billion in a cash-and-stock bid for Warner Bros. Discovery's assets. Paramount Skydance then entered with a competing cash offer of $111 billion. Netflix chose not to match this and withdrew from the agreement in late February 2026, triggering the payment of the termination fee. Paramount Skydance paid the $2.8 billion on behalf of WBD, enhancing Netflix's forecast for free cash flow in 2026 to $12.5 billion.

      By the end of Q1, Netflix's cash position was $12.3 billion, partly due to a pause in its share buyback program during the deal negotiations; it resumed repurchases post-withdrawal, buying back 13.5 million shares for about $1.3 billion in Q1.

      The share price reaction leading to the buyback was influenced by three factors:

      1. The Q2 2026 revenue guidance of $12.574 billion was slightly lower than the analyst consensus of $12.63 billion, indicating a potential growth slowdown.

      2. The full-year 2026 operating margin guidance was kept at 31.5%, below the consensus of 32%, despite the $2.8 billion windfall and an approximately 11% average increase in US prices that started in late March.

      3. Co-founder and Chairman Reed Hastings announced plans to leave the board after June 2026, while Co-CEOs Ted Sarandos and Greg Peters will continue to lead the company.

      Netflix maintained its full-year 2026 revenue projection of $50.7 billion to $51.7 billion and reiterated its intention to invest $20 billion in films and series. Growth in content amortization is expected to be skewed towards the first half of the year, with the highest growth rate year-over-year occurring in Q2 before tapering to mid-to-high single-digit growth in the latter half.

      In this context, the $25 billion buyback signals that Netflix considers its own shares to be the best way to utilize the capital obtained from walking away from the WBD deal; this approach is more conservative than pursuing a transformative acquisition but provides immediate per-share value for existing shareholders as the stock stabilizes following the withdrawal from the WBD agreement.