Streaming giant Netflix (NFLX) reported its second-quarter results after the bell on Thursday, and the market wasn't thrilled. Shares dropped 8% in after-hours trading, falling to $68.28 — below the previous 52-week low of $70.86. Ouch.

Let's break down the numbers.

Q2 Earnings: A Mixed Bag

Netflix posted Q2 revenue of $12.56 billion, up 13% year-over-year but just shy of the Street's $12.59 billion estimate. Earnings per share came in at $0.80, beating the consensus of $0.79 by a penny. So, a slight miss on the top line, a tiny beat on the bottom line.

Revenue by region tells a story of steady growth everywhere, with Latin America leading the pack:

• UCAN (U.S. and Canada): $5.43 billion, up 10%
• EMEA (Europe, Middle East, Africa): $4.03 billion, up 14%
• LATAM (Latin America): $1.58 billion, up 21%
• APAC (Asia Pacific): $1.51 billion, up 16%

Netflix said it's on track to meet its full-year objectives, and engagement remains strong. Viewing hours were up 2% year-over-year in the first half of 2026, even though that period included the Winter Olympics and World Cup — tough comps.

Live Events and Advertising: The Growth Engines

Netflix is leaning hard into live programming, which it expects to make up about 5% of its content spend in 2026 but only 1% of view hours. That might sound like a lot of money for not a lot of watching, but live events are driving sign-ups. The company says six of the top ten days for new member sign-ups over the past five years were tied to live events — and Netflix only started doing live events in 2023.

Advertising is another big bet. Netflix is on track to generate over $3 billion in ad revenue in 2026, and it's seeing strong interest from advertisers, especially around its live events lineup. The company mentioned advanced U.S. upfront negotiations are going well.

Guidance: The Real Story

Here's where things get a bit dicey. Netflix guided for Q3 revenue of $12.86 billion, up 12% year-over-year but below the Street's $13.01 billion estimate. Q3 EPS is expected at $0.82, versus the $0.84 consensus.

For the full year, Netflix narrowed its revenue guidance from a prior range of $50.70 billion to $51.70 billion to a new range of $51.00 billion to $51.40 billion. The Street was looking for $51.41 billion, so the midpoint of the new range is slightly below that.

That guidance is likely what's spooking investors. The stock is now trading at levels not seen in over a year, and with a 52-week high of $127.75, it's been a rough ride for shareholders.

What It All Means

Netflix is still a cash-generating machine with a massive subscriber base, but the market is focused on growth — and the guidance suggests growth is slowing. The company is betting that live sports and advertising will fill the gap, but it's going to take time. For now, investors are voting with their sell orders.