Netflix Bets Big on Live Sports as Co-Founder Exits Stage Left

The streaming giant is juggling a leadership transition, a potential bargain-priced studio acquisition, and an aggressive push into live sports—all while returning a staggering $25 billion to shareholders. The confluence of moves signals a company in transition, even as its founding visionary steps away.

Reed Hastings, who co-founded Netflix 29 years ago, informed the board of his departure on April 10, with the company making the news public alongside its first-quarter earnings on April 16. He will remain chairman and director until the annual shareholder meeting, but no successor has been named. Rich Greenfield of LightShed Partners told CNBC the exit is “unsettling investors.” While co-CEOs Greg Peters and Ted Sarandos have run day-to-day operations since 2023, Hastings’ symbolic departure removes a cornerstone figure just as the market questions where the next growth engine will come from.

That answer, according to Sarandos on the earnings call, is live sports. Netflix is actively negotiating with the NFL for an expanded rights package, aiming to grow from two games to four—including a new Thanksgiving Eve matchup and an international fixture. The current Christmas Day deal expires after this season. The NFL is currently shopping a five-game package to multiple bidders, which is driving up costs and pitting Netflix against established broadcast partners who are renegotiating their own deals.

The sports strategy is tightly linked to Netflix’s advertising ambitions. The $8.99-a-month ad-supported tier now accounts for over 60% of new sign-ups in ad-enabled markets, and the company works with more than 4,000 advertisers—a 70% jump from a year ago. Netflix expects roughly $3 billion in ad revenue for 2026, double the 2025 figure. In the first quarter alone, it streamed over 70 live events, including the World Baseball Classic in Japan, which drew 31.4 million viewers. Live content is the engine driving that growth.

On the real estate front, Netflix is in advanced talks to acquire the Radford Studio Center in Los Angeles for between $330 million and $400 million—a steep discount from its 2021 valuation of $1.85 billion. The 111,000-square-meter site houses 18 film studios, and the deal would allow Netflix to replace leased production space with owned property. That aligns with a broader expansion: the company is also planning a roughly $1 billion production facility in New Jersey.

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The board has also authorized a new $25 billion share buyback program with no expiration date, supplementing the roughly $6.8 billion still available under the previous plan approved in December 2024. The stock edged up about 1.5% in premarket trading on the news. Institutional investors hold roughly 81% of shares.

Netflix reported first-quarter revenue of $12.25 billion, up 16.2% year-over-year, with a global subscriber base of 325 million. But the second-quarter earnings-per-share outlook came in softer than expected, triggering a nearly 10% single-day sell-off on April 17—the sharpest drop in six months. The stock has since stabilized around the $93 mark.

Retail investors have been buying the dip, with $290 million in net inflows from individual investors over the past five trading days, the highest since December 2025. A William Blair analyst called the sell-off an overreaction, pointing to margin expansion and steady revenue growth in the low-to-mid teens.

For the full year, Netflix is sticking with revenue growth of 12% to 14% and an operating margin of 31.5%. Free cash flow is now expected at roughly $12.5 billion, up from a prior forecast of $11 billion, partly due to a severance payment tied to Warner Bros. Whether the NFL negotiations conclude by the next earnings report will offer a clear signal of just how serious Netflix is about live sports as its next growth chapter.