Streaming giant Netflix reported to shareholders in its second-quarter earnings report that generative artificial intelligence was applied in approximately 300 programs this year. The use of this technology covers all stages of project production: from concept and preliminary visualization to post-production and release.
The company cited projects such as the Indian sports thriller 'Glory', the Brazilian football miniseries 'Brasil 70: A Saga do Tri', and the documentary series on the American Revolution 'The American Experiment'. Netflix stated that AI enabled the creation of 'highly complex scenes', such as enhanced crowds and action sequences.
Netflix emphasized that AI tools help achieve higher product quality faster and at lower costs compared to traditional methods. There were instances where key shots and scenes would have had to be excluded from production without GenAI technologies.
This move is not unexpected, as the streaming platform is actively promoting the integration of AI across various areas of its business. This includes assisting users in finding new titles, strengthening the advertising division, and creating an AI-based animation studio. In March, the company acquired InterPositive, a startup founded by Benflaff, which, according to Netflix, will provide filmmakers with AI tools for use throughout the entire film and series creation process.
Netflix co-founder Ted Sarandos noted that the company already sees the impact of InterPositive on production, despite the deal being in its 'early stages'. He added that AI tools give 'creators better means to realize their visions' and allow to 'expand the boundaries of series that previously would have been impossible', producing them 'twice as fast and at half the cost compared to previous options'.
Ted Sarandos particularly stressed that the company's goal is not to replace creative professionals. He stated: 'We believe that great artists are needed to create something great, and AI does not change that. Movies are made by people who make movies. AI provides them with better tools to make them even better.'
Despite AI potentially accelerating and lowering costs, Sarandos believes that quality must remain high. He specified that, in his opinion, AI, especially InterPositive, will help creators do things better by using their own footage to enhance the film. At the same time, he reminded that screenwriters, actors, lighting technicians, and other specialists are still necessary to create cinema, but AI allows the film to be more efficient and effective.
Netflix is analyzing the possibility of implementing linear channels, broadcasting series, movies, and television programs, in addition to developing subscription packages that include services from other streaming companies. These strategies aim to reverse the trend of declining viewer engagement.
The proposed channels would have a fixed programming schedule, displaying specific content, such as a channel dedicated exclusively to series like Seinfeld or another focused on police dramas throughout the day. Simultaneously, packages with third parties would be marketed directly through the Netflix app, allowing users to access these services within the platform itself. This approach mirrors the model adopted by giants like Amazon Prime Video and Apple TV, seeking to consolidate itself as a central hub for various subscriptions.
The inclusion of these channels and streams on the application's home screen would represent a significant change in the company's current operational model, competing with the space traditionally reserved for Netflix's original productions.
According to sources consulted by the Wall Street Journal, the main reason for these changes lies in the deterioration of Netflix's engagement metrics. These metrics measure the time users spend on the platform and the frequency with which they complete content, which are crucial for the entertainment sector as they indicate consumer satisfaction and the probability of subscription retention.
The company's financial situation is also a relevant factor, given that its shares have plummeted by more than 40% in the last twelve months, and it has been recording decreasing operating margins annually. In the United States, Netflix's market share, according to Nielsen data, reached 7.8%, the lowest level since May 2025.
The streaming landscape is highly competitive. Meanwhile, Paramount is advancing the acquisition of Warner Bros. Discovery, following a deal valued at US$111 billion, and Fox Corp completed the purchase of Roku for US$22 billion in June 2026.
To maintain its relevance in the market, Netflix has already diversified its content, starting to incorporate video-format podcasts, materials already available on YouTube, and short videos from partners such as BuzzFeed and Condé Nast. This type of material has lower operational costs than its own series and films, helping to increase engagement.
In an international move, Netflix began broadcasting the TF1 channel in France, an agreement that pleased the partner in terms of audience. WSJ sources suggest that the company may seek similar partnerships in Europe and Latin America. Finally, there are future plans for participation in sporting events, with executives discussing entry into the bidding for the 2030 and 2034 World Cup broadcast rights.
