Netflix's Q2 FY2026 shareholder letter (July 16, 2026) places technology — and specifically AI/GenAI — as one of its three strategic pillars ("leveraging technology to improve every aspect of our service"), alongside entertainment value and monetization. At the outset, management summarizes the ambition: "We are leveraging AI to provide a more personalized, immersive and interactive experience for members, enhance ads capabilities for brands, and improve the quality of our series and films."
Production: GenAI scales up. This is the most tangible point. Across the entire production cycle — from concept and pre-visualization through post-production and delivery — the use of GenAI by Netflix's creative partners is "growing rapidly." In 2026, GenAI workflows were used across approximately 300 titles, with the highest concentration in post-production. Netflix highlights a dual benefit: higher quality, faster and at lower cost than traditional methods. The strongest claim: in some cases, productions would have had to forgo key shots or sequences without GenAI. Three examples are named — Glory (India), Brasil 70: A Saga do Tri (Brazil), and The American Experiment (US) — which used GenAI for complex sequences: augmented crowds, historical battles, worldbuilding establishing shots.
Product and discovery. Netflix leverages LLMs to improve title discovery and better understand member preferences. The search experience is enhanced with new voice search and AI-powered natural-language search, serving a "more personalized, immersive and interactive" experience.
Advertising. In the ads business, Netflix has extended its AI tools across the entire advertising cycle — planning, creative production, campaign management, optimization, and reporting. The company is further automating transactions with advertisers by extending programmatic access to Pause Ads and live inventory, reducing the manual effort that historically limited smaller buyers. These investments (Netflix Ads Suite + programmatic capabilities) are fueling ad growth.
All of this comes within a solid quarter: revenue of $12.6B (+13% year-over-year), operating margin of 33.4%, 2026 guidance tightened to $51.0-51.4B. The framing remains cautious: GenAI is presented as an augmentation of creators, never as a substitute — a communication choice that avoids controversies over rights and employment.