Stride shares fall 0.9%, Netflix drops despite both companies beating earnings estimates
Key Facts
Stride shares fell 0.9% after it reported results on October 20, 2026, as its financial guidance fell short of market expectations, according to Investing.com. The company reported adjusted earnings per share of $1.37 for the first quarter of fiscal 2027, beating analysts' estimates of $1.13. Revenue totaled $639.4 million for the same period, compared with an average forecast of $629.8 million, according to the website. Total student enrollment fell 2.5% year on year to 241,400, below the level management had expected for the fiscal quarter. The results thus combined earnings and revenue beats with declining enrollment and guidance below market expectations.
Netflix reported third-quarter 2026 earnings per share of 87 cents, according to figures cited by the Associated Press on the company's performance during the period. Analysts surveyed by FactSet had expected earnings of 82 cents per share, putting the reported result above their estimates for that measure. The company posted quarterly net income of $3.66 billion, according to the agency's coverage of the financial results. Revenue rose 12% from the same period a year earlier to $12.87 billion, compared with $11.51 billion in the third quarter of 2025. Revenue matched FactSet analysts' expectations, while the company's reported earnings per share exceeded estimates.
Netflix shares fell after the announcement, with the Associated Press linking the market reaction to the reduced advertising sales forecast and concerns about slowing revenue growth. Reuters reported that the company now expected advertising revenue of about $2.7 billion in 2026 after revising its estimates for the business. Its previous forecast had called for about $3 billion in advertising revenue for the same year, before the cut accompanying the results announcement. Netflix management attributed the revision to delays in rolling out some advertising product capabilities beyond its expected timetable, according to Reuters. Management described the rollout of those capabilities as "a little slower" in explaining the reduction in its annual advertising sales estimates.
As background to Netflix's current results, the company had reported year-on-year revenue growth of 13% in the second quarter of 2026, according to the Associated Press. Revenue for that preceding quarter totaled $12.56 billion, compared with $11.08 billion in the corresponding period of 2025, according to figures cited by the agency. The previous results announcement had also been accompanied by a decline in the company's shares in extended trading after the financial figures were released. On July 16, 2026, the shares fell 7.2% in that trading, according to the Associated Press's coverage of the reaction to the announcement at the time. The share price reached $69.02 in trading following the second-quarter results announcement, the previous session in which the stock came under pressure after results.
Stride's first-quarter announcement for its new fiscal year followed annual results published by the company in August, according to its filing with the U.S. Securities and Exchange Commission. Fiscal 2026 revenue totaled about $2,518.1 million, according to figures in that annual filing. The company compared that figure with revenue of $2,405.3 million in fiscal 2025, recording an increase between the periods. Stride reported annual net income of $338.2 million in fiscal 2026, according to the same filing. Net income for the comparative fiscal 2025 year had totaled $287.9 million, leaving the company entering its new reporting period after annual increases in both revenue and net income.
Looking ahead, Netflix forecast earnings per share of 67 cents for the fourth quarter of 2026, according to Reuters' reporting on the company's guidance. That compares with analysts' average forecast of 73 cents per share for the same quarter, putting the company's estimate below the level analysts expected for the next period. Stride's announced guidance covers the second quarter of fiscal 2027, according to Investing.com's coverage of the company's outlook following its results announcement. The company set the lower end of its expected revenue range for that quarter at $625 million in its estimates for the coming fiscal period. The upper end of the range was $645 million, according to the guidance cited by the website.