Netflix (NFLX) shares tumbled nearly 10% in extended trading after issuing softer-than-expected guidance for the second quarter. The streaming giant projected Q2 revenue of $12.57 billion—below Wall Street's $12.64 billion estimate—with EPS guidance of $0.78 missing the $0.84 consensus. Operating income forecasts of $4.11 billion likewise fell short of the $4.34 billion analysts anticipated.

Investors reacted sharply to the reduced pace of share buybacks, with Q1 repurchases totaling just $1.3 billion compared to 2025's $2.3 billion quarterly average. Co-CEO Greg Peters sought to reassure analysts, emphasizing the company's "solid momentum" and noting $6.8 billion remains in its buyback authorization. Executives maintained their capital allocation strategy despite showcasing new initiatives in podcasts, vertical videos, and live events.

The company did exceed Q1 revenue expectations with $12.25 billion in sales versus the $12.17 billion forecast. Market participants now await Netflix's ability to execute on its content pipeline and monetization strategies amid intensifying streaming competition.