Netflix has officially withdrawn from the competitive acquisition race for Warner Bros., leaving Paramount Skydance as the leading bidder.

Spence Neumann, Netflix’s CFO, explained at the Morgan Stanley Technology, Media & Telecom Conference that the decision was prompted solely by Paramount’s higher offer.

While acquiring Warner Bros. was appealing, Neumann emphasized it was “not a must-have at any price,” reflecting co-CEO Ted Sarandos’s earlier stance that Netflix approached the deal with a clear valuation strategy.

Netflix’s disciplined approach proved financially beneficial, as the company received a $2.8 billion breakup fee from Paramount Skydance after Warner Bros.

Discovery terminated its initial agreement with Netflix in favor of Paramount’s “superior” $31-per-share offer.

Neumann stressed that this experience did not change Netflix’s M&A strategy, which remains focused on opportunities that accelerate growth while maintaining financial discipline.

He also noted that Netflix had a clear path to regulatory approval and would have been strong stewards of Warner Bros.’ assets, reinforcing that the withdrawal was purely price-driven.

Looking ahead, Netflix projects continued financial growth, planning to raise its content spending to $20 billion in 2026—a 10% increase from 2025.

The company forecasts revenues of $50.7 billion to $51.7 billion, representing a 12%-14% year-over-year rise, with a 31.5% operating margin target.

By the end of 2025, Netflix’s global subscriber base surpassed 325 million, up from 301.2 million a year earlier.

Neumann confirmed that the planned increase in content investment aligns with expected revenue growth, showing Netflix’s commitment to remaining the leading destination for professionally produced entertainment worldwide.