Netflix said on Tuesday it had reached 325 million global paid subscribers, a new milestone for the streaming giant that last reported membership numbers a year ago.

The company reported fourth-quarter earnings and revenue that narrowly beat Wall Street estimates. Here’s how Netflix performed for the period ended Dec. 31, compared with estimates from analysts polled by LSEG:

• Earnings per share: 56 cents vs. 55 cents, estimated
• Revenue: $12.05 billion vs $11.97 billion, estimated

Net income for the period was $2.42 billion, or 56 cents per share, up from $1.87 billion, or 43 cents per share, during the same period a year earlier.

Netflix said revenue during the fourth quarter rose 18% year over year, driven by membership growth, higher subscription pricing and increased advertising revenue. In recent years Netflix has been focused on growing its ad-supported membership tier.

Netflix launched its ad-supported option in late 2022. On Tuesday, it said 2025 ad revenue grew by more than 2.5-times from 2024 to over $1.5 billion.

The company said it expects 2026 overall revenue to range between $50.7 billion and $51.7 billion, due to increases in membership and pricing, as well as “a projected rough doubling of ad revenue in 2026” compared to the prior year.

On Tuesday’s earnings call with investors, Netflix leaders noted what they described as heated competition among industry peers when it comes to gaining subscribers and growing profitability.

“Looking ahead to ’26 we’re focused on improving the core business, you know, and we do that by increasing the variety and quality of our series and films,” said co-CEO Ted Sarandos.

Still, Netflix’s stock was down 5% in after-market trading on Tuesday.

Netflix’s report drew comparisons to a Wall Street Journal report from April that outlined ambitious internal financial targets at the streamer. By those lofty standards, Netflix’s growth underwhelmed.

But co-CEO Greg Peters said the internal targets were considered “long term aspirations” and not to be confused with a forecast.

“Having said that, those goals were based on organic process,” Peters added, noting they didn’t take into account the impact of mergers and acquisitions.

Netflix’s quarterly report comes against the backdrop of its proposed transaction of Warner Bros. Discovery’s streaming and film studio assets. The company announcement in December that it had agreed to acquire streamer HBO Max and the Warner Bros. film studio for $27.75 per WBD share, or an equity value of $72 billion.

Earlier on Tuesday Netflix amended its offer to be all-cash. The company said Tuesday it would pause share repurchases to fund the acquisition.

Netflix said in its letter to shareholders that it believes the transaction will “allow us to accelerate our business strategy.”

Netflix said Warner Bros.’ library, development and intellectual property will allow it to boost its content selection for members and that HBO Max will help to “offer more personalized and flexible subscription options.”

However, the proposed acquisition came as a shock to the market as the streaming giant has long stayed away from industry consolidation and mega deals.

Since the announcement, Netflix’s stock has fallen in response. Since October, when Netflix was first rumored to be interested in the assets, the company’s stock dropped nearly 30%.

And the potential acquisition has not been without its bumps. Soon after announcing the deal with Netflix, Paramount Skydance launched a hostile effort to buy all of WBD. Lawmakers and industry insiders have also raised questions about whether the Netflix deal could win necessary regulatory approval.

“We’re working really hard to close the acquisition of Warner Bros. Studios and HBO, which we see as a strategic accelerant,” Sarandos said on Tuesday’s call. “And we’re doing all this while we’re driving and sustaining healthy growth.”

This story is developing. Please check back for updates.