Netflix’s third-quarter revenue leapt 17% to $11.5 billion, thanks to the record-smashing success of its animated film KPop Demon Hunters, which racked up 325 million views in its first 91 days. That’s enough to dethrone Red Notice, which previously held the top spot with 230.9 million views.
“KPop Demon Hunters became our most popular film ever,” Netflix stated in its shareholder letter, with CEO Ted Sarandos adding, “when you have a hit the size of ‘KPop Demon Hunters,’ it stirs the imagination of where you can take this.”
The film, following a trio of pop idols who moonlight as demon hunters, not only captivated global audiences but also opened new doors for the brand.
Sarandos credited Netflix’s model for the film’s success. “We believe this film, KPop Demon Hunters, actually worked because it was released on Netflix first,” he said, suggesting that superfans’ repeat viewing habits helped build momentum ahead of its theatrical run.
To capitalise on the hype, Netflix inked new licensing deals with Hasbro and Mattel, bringing dolls, action figures and other KPop Demon Hunters merch to store shelves.
Read more: K-Pop is Driving South Korea’s Record-Breaking Tourism Surge
Beyond the animated megahit, Netflix’s Q3 lineup flexed its range — from Wednesday’s second season to teen drama My Life With the Walter Boys. And with the year’s final stretch still to come, the streamer is doubling down with Guillermo del Toro’s Frankenstein, the final season of Stranger Things, and even family-friendly TV games like Boggle.
Netflix now counts over 301 million subscribers globally and expects another 17% revenue bump in Q4, with full-year sales forecasted at $45.1 billion, up 16%. The company also plans to more than double its ad revenue in 2025.
View this post on Instagram
However, even with those blockbuster numbers, Netflix’s profits came with a catch. The company reported net income of $2.5 billion, up 8% year-on-year but below the $3 billion analysts had forecast — weighed down by a $619 million tax dispute in Brazil.
“Absent this expense, we would have exceeded our Q3’25 operating margin forecast,” Netflix told shareholders. “We don’t expect this matter to have a material impact on future results.”
Still, investors weren’t fully convinced — Netflix shares dropped 5% in after-hours trading on Tuesday, closing at $1,241.35.
“With entertainment industry employment becoming more precarious, Netflix is slyly pivoting its content strategy to rely more on live sports, YouTubers, creators and podcasters,” said Ross Benes, senior analyst at Emarketer.
But not everyone’s convinced the streaming giant can keep its edge. “Netflix’s core lay-back easy-to-watch scripted content is potentially most at risk by the emergence of generative AI compared to peers,” said John Conca of Third Bridge. “Netflix will need to channel its earlier days and find a way to remain nimble, even though it’s now the 800-pound gorilla in this space.”
