Netflix co-CEO Ted Sarandos has admitted that the streamer is not growing as fast as he wants, just as the Paramount and Warner Bros. merger moves closer to reality. Streaming executives usually greet any slow numbers with a confident smile and a carefully rehearsed talking point. This time, the straight talk came from the top of the company.  It also arrived on the very day the competition cleared a major legal hurdle.

While the rest of Hollywood races to merge and grow, Netflix has an awkward set of viewership numbers to explain.

Netflix is growing more slowly than its leadership would like, and Ted Sarandos said it out loud. Viewership rose by only 2% in the first half of 2026. The slowdown comes as the entertainment industry enters another major shake-up, with a federal judge on Wednesday approving a settlement that clears the last major legal hurdle to Paramount Skydance's roughly $110 billion takeover of Warner Bros. Discovery.

"Overall, we're not growing as fast as I want us to," Sarandos said at Bloomberg's 2026 Screentime event.

He then added, "we’re working on making that move faster."

At Bloomberg's 2026 Screentime event, Sarandos explained that live programming currently takes about 5% of its $20 billion annual content spend but delivers only about 1% of viewership. Live events still bring in plenty of signups and cut churn, while advertisers love them. He also has no regrets about Netflix's brief winning bid for Warner Bros., which he priced at the limit of what made sense for shareholders.

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As rivals combine to grow bigger, Netflix is betting on a chatty algorithm to help viewers pick what to watch.

Netflix is testing a chat feature that lets viewers ask for a mood instead of a title, like consulting a very well-read friend. Ritwik Kumar, Netflix vice president of AI strategy and innovation, told Fortune that early pilots showed users had plenty to say. A viewer could ask for a light mystery or an easy watch after a long day, then refine the results with a few quick follow-up prompts.

Kumar says spoken requests give the system richer detail about mood and intent. Netflix is testing ads that match the tone of a show, even referencing a paused Stranger Things. Behind the camera, Netflix bought Ben Affleck's AI firm InterPositive in March, for about $587 million. Creative partners used generative AI tools on about 300 titles this year. Netflix AI may soon change how viewers discover movies and shows, but Sarandos made clear that fresh tech alone will not settle the bigger question of why growth is slower than he wants.

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What are your thoughts on Netflix chatting with viewers while growth slows? Let us know in the comments.