Netflix Leans on Live TV as YouTube Competition Threatens Growth, Analysts Weigh In

Netflix Inc. (NASDAQ:NFLX) is leaning on live programming, advertising and its global subscriber scale to revive growth as investors weigh weaker engagement, a lack of breakout hits and intensifying competition from Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL) YouTube and other streaming platforms.

The debate comes ahead of Netflix’s Oct. 20 third-quarter earnings report, with Wall Street expecting revenue growth of nearly 12%, its slowest pace since 2023, while net income is projected to rise 36%.

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Sarandos Turns to Live Content for Growth

Netflix co-CEO Ted Sarandos acknowledged that the company needs to accelerate.

"Overall, we’re not growing as fast as I want us to, and we’re working on making that move faster," Sarandos said.

He said live programming is generating "a lot of signups," reducing churn and supporting advertising growth.

Netflix invests about $20 billion annually in content, with roughly 5% going toward live programming. Live content accounts for about 1% of viewing but is helping expand the subscriber base, according to Sarandos.

Netflix also avoided paying more for Warner Bros. Discovery, with Sarandos saying a higher bid could have pushed the economics "into negative territory."

Analysts Flag Engagement and Content Risks

Wall Street has grown more cautious as engagement slows, Bloomberg reported on Thursday.

HSBC analyst Mohammed Khallouf downgraded Netflix to Hold, arguing that YouTube’s gains are "increasingly coming at the direct expense of Netflix." He cited weaker reception to Netflix originals and said a "near-term recovery in engagement looks unlikely."

YouTube’s U.S. TV viewing share reached 14.2% in July, while Netflix fell below 8%.

Wells Fargo also issued a sell-equivalent rating, pointing to a shortage of hit shows.

Accuvest Global Advisors CIO Eric Clark, whose firm owns Netflix while reducing its position, called the company a "show-me story" and said it needs more blockbuster programming to improve engagement.

Deutsche Bank Sees Competitive Advantages Intact

Deutsche Bank analyst Bryan Kraft took the opposite view and upgraded Netflix to Buy from Hold.

Kraft said concerns about engagement are overstated because programming performance naturally moves through cycles.

He highlighted Netflix’s "established competitive advantage" in international production along with its brand, global subscriber and revenue scale, and ability to broaden into a larger entertainment platform.

Wolf Says Netflix Remains a Consumer Default

Activate Consulting founder and CEO Michael Wolf also remains bullish.

Wolf told CNBC on Friday that Netflix and YouTube have become the services consumers often turn to first, giving them an advantage over legacy media and smaller streaming rivals.

Asked whether he would buy Netflix at current levels, Wolf said, "Yes," adding that "Netflix has got, um, a lot of growth ahead."

He believes traditional media companies still face the harder task of converting franchises, sports rights and streaming investments into sustained subscriber and advertising growth.

Investors Weigh Competition Against Valuation

Sparrow Growth Fund CIO Gerald Sparrow said Netflix faces genuine competition but retains a history of finding hits and expanding into areas including sports, podcasts and gaming.

The stock has fallen 30% in 2026.

NFLX Price Action: Netflix shares were down 0.92% at $67.23 at the time of publication on Friday. The stock is near its 52-week low of $65.10, according to Benzinga Pro data.

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