Netflix falls 5%, Supermicro jumps 12% after hours as business outlooks diverge
Key Facts
Netflix shares fell 5% in after-hours trading on October 20, 2026, while Supermicro jumped 12%, according to Investing.com, as the companies issued divergent business updates. Netflix's decline followed a cut to its annual advertising revenue forecast, while Supermicro announced higher preliminary estimates for revenue and gross margin. Netflix set its new 2026 advertising revenue forecast at about $2.7 billion, according to its shareholder letter filed with the U.S. Securities and Exchange Commission. The company had previously expected the business to generate about $3 billion in revenue during the year. It attributed the lower forecast to a slower rollout of some advertising product capabilities than it had expected.
Netflix shares came under pressure despite higher third-quarter revenue and profit and earnings per share that beat analysts' expectations. Quarterly revenue rose 12% to $12.87 billion from $11.51 billion in the same period a year earlier, according to the Associated Press. Diluted earnings per share were $0.87, according to the company's shareholder letter. That compares with earnings of $0.59 per share in the third quarter of 2025. Analysts surveyed by FactSet had expected earnings of 82 cents per share, according to the news agency. Operating margin also rose to 34.6% from 28.2% a year earlier, according to the company's official disclosure.
Netflix said subscription growth and higher prices helped support third-quarter revenue, citing "increases in subscriptions and prices" among its growth drivers in the letter. The company added that advertising also contributed to revenue growth during the period, alongside its subscription business. Quarterly revenue also benefited from favorable currency movements, according to the shareholder letter. The results follow Netflix's announcement on October 14, 2026, of plans to cut about 6% of its workforce, according to the Associated Press. The plans include eliminating about 1,000 jobs as part of organizational changes announced by the company.
Supermicro set its new preliminary revenue estimate at a range of $18.5 billion to $19.5 billion for the first quarter of its fiscal year 2027. The update covers the quarter ended September 30, 2026, according to the company's business update. Previous guidance put revenue in a range of $14.5 billion to $15.5 billion, before increased demand for AI platforms prompted the company to raise its estimates. Supermicro also raised its gross margin estimate to a range of 12.0% to 12.5%, compared with a previous range of 10.4% to 10.8%. The company attributed the improved margin estimates to its customer and product mix in an update presenting preliminary figures for the period.
After-hours moves extended to Intuitive Surgical, whose shares fell 11%, while Capital One Financial rose 5% following results, according to Investing.com. Intuitive reported revenue of about $3.05 billion for the third quarter of 2026, up 22% from $2.51 billion a year earlier. The company attributed revenue growth to increased procedures, leasing revenue and its installed base of systems, according to its filing with the U.S. Securities and Exchange Commission. Procedures performed using the da Vinci system grew about 14% from the same period a year earlier. Adjusted net income was $1.05 billion, or $3.00 per diluted share. The company also recorded a $450 million pretax charge to settle an antitrust class action, with the settlement still awaiting court approval.
Looking ahead, Netflix expects revenue of $13.4 billion in the fourth quarter of 2026, according to its shareholder letter. Attention to corporate earnings continues on October 21, 2026, with Pegasystems' earnings call, according to the company's announcement. Pegasystems scheduled the call for 8:00 a.m. U.S. Eastern Daylight Time. United Airlines holds its earnings call on the same day, according to the schedule posted on the company's investor relations website. The airline's call begins at 10:30 a.m. U.S. Eastern Daylight Time.