Netflix shares fell about 5% in after-hours trading this week, as investors looked past a strong fourth-quarter performance and focused on signs of slowing growth and rising strategic uncertainty, including the company’s evolving approach to Africa.
The streaming giant reported solid fourth-quarter results, with revenue rising 17.6% year-on-year and operating margins expanding to 24.5%.
Earnings per share jumped 30%, while free cash flow climbed to nearly US$1.9 billion, highlighting the company’s improving profitability. Advertising revenue also continued to scale, reaching US$1.5 billion in 2025, and paid memberships surpassed 325 million globally.
Despite these positives, the market reaction was negative. The main concern was management’s guidance for 2026, which pointed to slower revenue growth.
Netflix forecast full-year revenue growth of 12% to 14%, but on a constant-currency basis this implies growth of just 11% to 13%, down from the roughly 17% achieved in 2025. For a stock trading at a premium valuation, the prospect of decelerating growth was enough to trigger a sell-off.
Adding to investor caution is Netflix’s increased reliance on partnerships to drive expansion in tougher markets. In Africa, the company recently announced a bundling deal with French media group Canal+, which will integrate Netflix into Canal+’s pay-TV offering across 24 Francophone African countries.
The partnership gives Netflix instant access to more than 8 million Canal+ subscribers and helps it bypass persistent challenges such as high data costs, payment friction, and device limitations.
While the deal strengthens Netflix’s distribution, it also signals a shift away from direct subscriber acquisition in the region.
Africa remains a highly competitive and price-sensitive market, where Netflix has struggled to outperform rivals such as MultiChoice-owned Showmax.
