Netflix Worries Binge-Watching Era Is Over

Netflix may have been declared the victor of Hollywood’s so-called Streaming Wars, but it hasn’t been able to enjoy many spoils at the end of the long campaign. 

Now, with the company’s share price down some 20% so far this year and off more than 40% from a peak last summer, Netflix executives are hoping that some sure-to-be impressive numbers in today’s quarterly earnings report will begin to reshape an increasingly negative narrative.

Last Season On …

The big problem for Netflix? People are watching less Netflix. Executives have grown obsessive over a plague of second-season viewership drop-offs this year, according to a recent Bloomberg report. Hit Netflix originals such as Beef, One Piece and The Night Agent have each lost between 30% and 70% of their first-season audiences, according to Netflix’s own figures. One likely culprit is the lengthy gap between seasons; the first season of One Piece was Netflix’s biggest hit of the year … way back in 2023. Subsequent debuts have struggled to fill the void. In April, Netflix accounted for just 7.8% of total US viewership, trailing archrival YouTube’s 13.4%, its worst showing in about a year. That comes after the company said total viewing hours barely increased in the second half of its fiscal year 2025.

It’s igniting fears that Netflix’s old-school binge model doesn’t quite match Wall Street’s new favorite media industry buzzword: engagement. In response, Netflix leadership is workshopping all sorts of new ideas:

• Netflix announced partnerships this month to host video content from digital publishers such as BuzzFeed, Condé Nast and Penske Media. The company is also considering offering bundles for rival streaming services, such as Peacock, within its platform, sources recently told The Wall Street Journal.
• Executives have also considered adding a suite of always-on “live channels” to the service, per the WSJ, and the company has thrown its hat in the ring for 2030 and 2034 World Cup broadcast rights, according to a CNBC report. (Yes, this all amounts to the cable bundle you previously abandoned.) 

Happy Ending? The good news for Netflix? Despite the array of challenges, profits have trended upward while subscriber churn remains among the lowest in the industry. Meanwhile, its industry peers have enough troubles of their own. Comcast is jettisoning its NBCUniversal division, while Paramount faces a legal fight with state regulators to complete its Warner Bros. acquisition, and a Wells Fargo Securities note earlier this week suggested Disney would be better off ditching its streaming service entirely. Which goes to show it can always be worse.