Netflix Slides on Earnings Miss, WBD Update, Return of the Memes 10/22/25

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David Faber (0:45)

Market insight and analysis. You're listening to the opening bell of CNBC's Squawk on the Street.

Carl Quintanilla (0:51)

Good Wednesday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer and David Faber at Post 9 of the New York Stock Exchange. Future is pretty solid after the Dow's record high on Tuesday. Busy session of earnings today. AT&T, GE, Vernova, Texan, Netflix. Tonight we'll get Tesla and IBM. Arroyo begins with Netflix shares dropping in the pre-market after the streamer does miss because of this tax dispute in Brazil.

David Faber (1:13)

Shares of Texas Instruments are also dropping. And this on disappointing guidance, the company warns of a slower recovery in the chip industry. Release certainly what parts it plays in. And keep an eye on gold because it is falling again. This after suffering what was its biggest drop yesterday in more than a decade.

Jim Cramer (1:32)

Was it a collapse?

David Faber (1:34)

I wouldn't say it was a total collapse, but collapse perhaps was not such a ill-fitting word, Jim.

Carl Quintanilla (1:42)

The real-time editing continues. We'll begin with Netflix though. Shares are down. In reaction to that earnings miss, co-CEO Greg Peters summed up the results in the state of the business on last night's call.

SPEAKER_2 (1:54)

We think the business is very healthy. We feel good about our progress on our key initiatives. We've got also a lot of opportunity ahead of us, but we've got a lot of work we need to do to accomplish and fully realize those opportunities. So what's working? We had a good Q3. We had revenue in line with expectations. Our operating income would have exceeded our forecast absent the Brazilian tax matter. We're also seeing good progress against our key priorities. So engagement remains healthy. We achieved record share at TV time in Q3 in both the US and the UK. We recorded our best ad sales quarter ever. We're now on track to more than double ad revenue this year.

Carl Quintanilla (2:31)

So Brazil did kind of ding margins on that quarter.

Jim Cramer (2:33)

Yeah, I think one of the problems is it was just, they claimed it was telegrammed, but you really had to go through a lot of fine print to be able to realize that. I'm going to take the other side of the selling. I thought the quarter was excellent. I think that the engagement is really good. I think advertising is really good. I think what the slate that they have is really good. And what happens is something like this, okay? You say, listen, I want to sell it. And then Friday, Catherine Bigelow's A House of Dynamite comes out. And then all Monday, we're all coming over to talk about House of Dynamite. I just think that to leave this stock with their advertising, with the gaming possibly coming, with them having to say, listen, we don't need any of this stuff with Warner Bros. Discovery. We can do it our own.

David Faber (3:10)

Well, I'm not sure they said that. We'll get to that in a minute, because they did not say that.

Jim Cramer (3:13)

They don't need to buy anything.

David Faber (3:15)

No, they didn't say that either.

Jim Cramer (3:16)

Well, okay, they can make, they have their own destiny.

David Faber (3:20)

They don't want to buy any linear cable networks. That's not part of the deal for Warner Bros. But let's stay on Netflix.

Jim Cramer (3:27)

Okay, well, I'm just saying that I felt it was a strong quarter.

David Faber (3:31)

So what's your spot? Why is it just Brazil that's got the stock off 8%?

Jim Cramer (3:34)

Because I think people just said, you know what, this is a beat and raise situation, and they didn't beat and raise. And I come back and I say, very few companies are in control of their own destiny as this company, and they still have a lot of time. Remember, they view it as the clock that is their...