Netflix Hasn’t Cracked Original Movies, but Wall Street’s Not Worried

Netflix has seemingly solved the economics of streaming, but it hasn’t yet mastered movies.

Viewership for Netflix’s original films shrank in the last two years, even as inventory rose, according to new research from MoffettNathanson based on data from Netflix’s self-published engagement report.

Movies made for Netflix generated 9.2 billion viewing hours in the first half of 2025, 7% lower than the back half of 2024, and well down from 10.3 billion viewing hours in the first half of 2023. Those declines came despite an increase in the number of original film titles available on the platform.

That suggests Netflix’s original movies have “gotten less popular,” Joe Bonner, who covers Netflix for Argus Research, told Business Insider.

The soft viewership comes despite a slight increase in Netflix’s overall viewership, which the company said rose 1% year-over-year in the first six months of 2025.

Netflix’s original movie output has also declined since 2022, according to research from Kasey Moore, who runs the What’s on Netflix site that tracks Netflix releases. (The streamer’s original film output is typically lower in the first half of the year, and company executives remarked last week that this year’s slate is “unusually second-half weighted.”)

Moore said instead of making its own movies, Netflix is increasingly leaning on licensing new and existing movies from other studios.

“They’re using other people’s movies to boost their viewership all around the world,” Moore told BI.

A Netflix spokesperson said the company doesn’t comment on analyst reports but pointed to the company’s latest shareholder letter.

Netflix’s movie misses may not matter much

Although Netflix has made a slew of smash-hit shows, like “Squid Game” and “Adolescence,” its original movies haven’t often caught fire — or impressed critics.

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Audience reviews for Netflix’s most-watched original movies have trended lower in the last two years, according to ratings from Rotten Tomatoes cited by MoffettNathanson’s Robert Fishman, who authored the report.

“While the critical reception to Netflix’s original series has improved considerably over the past two years, the reception to Netflix’s original films remains muted,” Fishman wrote in the note.

Exhibit A is “The Electric State,” a straight-to-Netflix movie that Puck reported cost in the neighborhood of $300 million.

Critics panned the flick, which garnered a 14% Rotten Tomatoes score, though audience reviews were more upbeat. Netflix said that the film starring Chris Pratt and Millie Bobby Brown racked up 74 million views since its mid-March debut — seventh most among its movies in the first half of 2025. But at that mammoth budget, it’s unclear whether that bet paid off for Netflix.

If Netflix’s original movies don’t make waves, Bonner said the streaming giant may have to do some soul searching on whether original movies are “worth the declining return on investment.”

When it comes to film, Bonner said that Netflix has “a reputation for middling quality versus, say, HBO Max.”

However, Bonner remarked that even a softer slate of original movies “did not impact subscriber acquisition, revenue, or profits” for Netflix in its latest quarter. Instead, he said investors were excited about the streamer’s successful password-sharing crackdown and ad-tier growth.

While Netflix hasn’t yet perfected its film strategy, Comscore movie analyst Paul Dergarabedian said it can keep taking swings thanks to its “massive footprint and incredible financial resources.” That’s why he’s confident that eventually, the streaming titan’s movies can be as big as its shows.