Netflix has long been “a builder, not a buyer.” Are those times over?

For years, Netflix The top brass would tell investors they were builders, not buyers. Today, that sentiment toward growth may be changing.

On Thursday, Netflix released its quarterly results. Typically, Netflix’s earnings calls focus on metrics like engagement, content spending, price increases, and stickiness. While these factors were still present during Thursday’s call, analysts were also questioning Netflix’s M&A aspirations following the call. Discovery of Warner Bros. sales process.

Late last year, Netflix emerged as a bidder for WBD, surprising many in the industry and market. Even more surprising was the announcement in December that Netflix had reached an agreement to acquire WBD’s movie studio and streaming assets in a $72 billion deal.

While the transaction initially raised eyebrows, it now opens the door to questions from media viewers and insiders about whether the company should make other deals as streaming becomes more competitive.

Netflix co-CEO Ted Sarandos said Thursday that there were also questions, both internally and externally, about the company’s ability to pull off such a mega-deal.

“What we learned, though, was that our teams were more than up to the task,” Sarandos said. “We learned a lot about deal execution and early onboarding.”

Netflix had said its reasoning was simple for the pivot to a major acquisition. Although it was by far the largest streaming service in terms of subscribers – 325 million paid members worldwide reported as of January – it wanted to deepen its array of franchises and intellectual property, and move more directly into the movie studio business.

Paramount Skydance Ultimately, the deal was reversed in February with a higher offer, and Netflix withdrew (quickly collecting its $2.8 billion breakup fee).

“But most importantly, we’ve really grown our capabilities in mergers and acquisitions,” Sarandos said. “And the most important benefit of this whole exercise, however, is that we tested our investment discipline.”

Sarandos’ new openness to mergers and acquisitions has some wondering whether the streaming giant might be looking for new targets.

After all, its intellectual property library and relationships with the movie studio industry are still where they were before they did the WBD deal.

Although Wall Street clearly wasn’t a fan of Netflix’s proposed acquisition of WBD (shares fell 15% between the deal’s announcement and the day it fell through, and have since risen about 26%), the media landscape will undeniably be different if Paramount’s takeover is approved.

Paramount is looking to buy WBD’s entire business: cable TV networks, movie studio, streaming and all. This would create a giant competitor to Netflix and its media peers on various fronts.

“How the WBD cards fell matters a lot. A likely combination of Paramount+ and HBO Max changes the streaming landscape in a way that Netflix hasn’t really had to deal with before,” Mike Proulx, vice president and research director at Forrester, said before Netflix’s results were released.

“I just want to remind you that we said from the beginning that the agreement with the WB was a good thing, not a necessity. We are very confident in our core business,” Sarandos said on Thursday. He added that Netflix saw its biggest risk in the transaction process as losing focus on its core business.

“As you can see from our first quarter results, we have not lost our focus,” he said.

Still, Netflix’s earnings report, and particularly its forward guidance, seemed to disappoint investors.

The company’s shares fell about 10% in extended trading after the streamer maintained its full-year guidance despite higher first-quarter revenue and the termination of the WBD deal.

“The biggest surprise this quarter was the continuation of full-year margin guidance despite abandoning the Warner Bros. deal and associated M&A costs,” analyst Robert Fishman of MoffettNathanson said in a research note Friday.

Netflix, for its part, didn’t spend too much time on mergers and acquisitions during the earnings call, instead focusing on its more familiar talking points like user engagement, a growing advertising business, and spending on content that retains members (and helps justify price hikes).

The return to the typical Netflix narrative seems to be welcome.

“After WBD, the company could return to its continued focus on revenue and profit growth by leveraging its global subscriber base,” Fishman said in Friday’s note. He added that Netflix management “highlighted the success of its recent price increases and noted that retention was strong,” and that the company remained on track to double its advertising revenue this year.

Still, Forrester’s Proulx said in a note after the conference call that even though Netflix was once again “squarely focused on executing on its proven playbook,” questions remained.

“None of this changes the reality that the streaming market is more competitive than it was a year ago,” Proulx said. “Pricing power must be earned quarter over quarter, and maintaining engagement as prices rise remains the central challenge in the streaming market. Netflix is ​​betting that steady execution of its core business will win out in a more crowded and consolidating market.”