Netflix boss Ted Sarandos has surprised many by admitting the company considered opening a theatrical division well before its attempt to acquire Warner Bros. Discovery. He’s been a vocal opponent of releasing Netflix films in theaters – beyond the limited runs needed to qualify for awards – making this revelation quite unexpected. It appears a theatrical release strategy was consistently under discussion despite his public statements.
During the company’s fourth-quarter 2025 earnings call, co-CEOs Ted Sarandos and Greg Peters clarified that they aren’t opposed to releasing films in theaters. They explained that their main focus has been on quickly expanding their streaming service. Sarandos stated:
When I said those things, we weren’t focused on movie theaters. As I’ve mentioned before, this is a business, not something based on beliefs, so things naturally evolve. We’re a company that regularly reassesses our strategies when circumstances change. We spent years discussing whether to create our own system for releasing movies in theaters, but with limited resources, it just wasn’t a high enough priority.
Netflix is expanding into theatrical distribution by acquiring a portion of Warner Bros. Discovery. According to Netflix’s Ted Sarandos, this deal will allow them to show films in cinemas as well as on their streaming service.
We’ll be able to leverage a large, top-tier movie distribution network that has generated over $4 billion in ticket sales worldwide. We’re eager to keep this successful business running and make it even stronger.
Netflix Could Have Been Raking It in With Theatrical Releases
Netflix
For a long time, people have wondered why Netflix is hesitant to release its films in movie theaters. While they now sometimes give movies a small theatrical release to qualify for the Oscars, Netflix’s public position, as stated by Ted Sarandos, has always been that their primary focus is streaming, and always has been.
Recent statements suggest Netflix hasn’t always favored its current strategy, and the possibility of releasing films in theaters before streaming has been considered before. The main question now is why they didn’t pursue that option. Over the past few years, Netflix has produced several large-scale movies, including sequels to Knives Out, Taron Egerton’s Carry-On, the previously most-watched Red Notice, and last year’s KPop Demon Hunters. Had these films been shown in theaters for a while before becoming available on the streaming service, they could have generated billions of dollars in revenue for Netflix.
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Sarandos and Peters consistently prioritized providing subscribers with fresh content to justify their monthly subscription fee of $6–20, even if many films eventually appeared in theaters first. The new agreement with Warner Bros. is likely to expand Netflix’s involvement in theatrical releases, but these films will still be branded as Warner Bros. productions, while Netflix will continue to release its own original movies under the Netflix name.
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2026-01-21 02:47