Netflix says growth is slowing as AI, live shows drive spending
Netflix Co-Chief Executive Officer Ted Sarandos has said the streaming giant is not growing as quickly as expected, as the company increases spending on live programming, theatrical releases and artificial intelligence to drive engagement among its 325 million subscribers. The post Netflix says growth is slowing as AI, live shows drive spending appeared first on Nairametrics .
Ted Sarandos, Co-Chief Executive Officer of Netflix, revealed at the Bloomberg Screentime conference in Los Angeles that the streaming company is experiencing slower growth than anticipated. This slowdown is due to increased investments in live programming, theatrical releases, and artificial intelligence to enhance subscriber engagement.
With 325 million subscribers, Netflix is working to boost the time spent on its platform by expanding its content offerings beyond traditional films and TV shows. Approximately 5% of its $20 billion content budget, which amounts to around $1 billion, is dedicated to live programming.
Despite a 2% increase in engagement during the most recent reporting period, revenue continued to grow at a double-digit rate across all regions. Netflix is also planning to release major films in theaters, such as Narnia and Charlie and the Chocolate Factory later in the year. Additionally, a sequel to KPop Demon Hunters is set for a "very broad release." The company has been aggressively releasing over 30 movies in cinemas annually.
Artificial intelligence is playing an increasingly significant role in Netflix's production strategy. The company acquired AI filmmaking technology firm InterPositive for $587 million in March, aiming to integrate generative AI throughout various stages of film and television production. Sarandos disclosed that artificial intelligence has been employed on approximately 300 Netflix titles, mainly for post-production tasks like pre-visualization, visual effects, and the creation of intricate shots and sequences.
The technology is expected to accelerate production timelines, reduce costs, and maintain or enhance content quality.
Sarandos also discussed Netflix's unsuccessful bid to acquire Warner Bros. Discovery's film and television studios and HBO Max, stating that the company is currently not seeking another acquisition to replace Warner Bros. Instead, Netflix's growth strategy is expected to remain primarily organic. In January 2025, Nairametrics reported that Netflix had surpassed 300 million global subscribers, ending 2024 with 301.63 million users after adding a record 18.91 million subscribers in the fourth quarter.
Since then, the company has shifted its focus to revenue, operating margins, and engagement rather than reporting subscriber additions quarterly. Recently, in June 2026, Nairametrics reported that Netflix was utilizing generative AI to enhance content discovery, including testing a voice interface that allows subscribers to input their preferences. This initiative is part of Netflix's efforts to increase engagement as its content library expands.
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