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XBig Changes Coming to Netflix After Catastrophic Earnings
Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.
After disrupting the film and television industry, Netflix is about to undergo some disruption itself.
The streaming service announced Tuesday that some big changes are on the way after a disastrous first quarter that sank its share price in after-hours trading. In response, the company vowed to crack down on password sharing—a longstanding issue that Netflix has largely ignored until recently—and co-CEO Reed Hastings all but confirmed that it will finally add an advertising-supported subscription option. The company is even “pulling back” on its spending growth to reflect its new financial reality.
“When we look at the last 20 years…we've gone through a lot of changes, and we've always figured them out one by one,” Hastings said on Netflix’s earnings call Tuesday. “We have a bunch of opportunity to improve, but coming out the other side, I’m pretty sure we'll look at this as really foundational in our continued journey.”
Netflix shares cratered after investors learned that the streaming platform had lost subscribers for the first time in more than a decade last quarter—with its stock price down nearly 26% in after-hours trading, to under $259 per share. Netflix not only shed 200,000 subscribers from January through March, but said it expects to lose 2 million more in the current second quarter.
Part of the problem was that the company lost 700,000 subscribers after suspending its service in Russia, in protest of that country's invasion of Ukraine. But even excluding its Russian retreat, Netflix would have added only 500,000 paying customers last quarter—well below the 4 million it added in the year-earlier period, as well as the 2.5 million it had previously projected for the first quarter.
Netflix management told shareholders Tuesday that COVID-19 had clouded its outlook; the pandemic turbocharged growth in 2020 as consumers were stuck at home, leaving company leaders believing the subsequent slowdown was only a pandemic hangover.
Now, Netflix is acknowledging what many observers have long speculated: The original streaming giant has been battered by the streaming wars. After being caught flat-footed by the rise of streaming, legacy media giants like Disney and Warner Bros. Discovery have joined the market that Netflix essentially created, offering content and pricing that is often as good, if not better.
In a letter to shareholders, Netflix placed much of the blame on password sharing, estimating that 100 million households may be using accounts without paying for them. (The company has 222 million paying customers globally.) Netflix management said it sees a “big opportunity” to monetize those non-paying households.
The problem is “not a new thing,” Hastings acknowledged. Indeed, account-sharing as a percentage of its paying membership hasn’t changed much over the years, Netflix reported Tuesday, and may have even helped fuel its growth by getting more people to use the app. But coupled with other factors, Netflix now believes it is a major headwind—and with new user growth now at a standstill, the day of reckoning for password-sharing may soon be arriving.
The same can be said for Netflix’s resistance to advertisements. Despite other streaming services luring customers with cheaper ad-supported options, Netflix hasn't budged when it comes to commercials—until now.
“Those who have followed Netflix know that I've been against the complexity of advertising and a big fan of the simplicity of subscription,” Hastings said. “But as much as I'm a fan of that, I'm a bigger fan of consumer choice, and allowing consumers who would like to have a lower price and are advertising-tolerant get what they want makes a lot of sense.”
Other changes may also be on the way. Netflix may have popularized “binge-watching” by giving consumers entire seasons of shows all at once, but some industry observers believe that approach fuels cancellations, since consumers can plow through a show then ditch the service before their next monthly bill.
Netflix plans to release the upcoming season of the fan favorite “Stranger Things” in two parts, which could keep some customers subscribed to the platform for a bit longer. Co-CEO Ted Sarandos described the approach as “satisfying for the binger or the one-at-a-time viewer as well.” He also spoke positively of Netflix releasing some unscripted shows in “mini-batches” on a weekly basis.
One place where Netflix doesn’t seem ready to budge is live sports, though Sarandos didn’t completely close the door on that one, either.
“I'm not saying we'd never do sports, but we'd have to see a path to growing a big revenue stream and a big profit stream with it,” he said.
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Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.
The $100M Plan to Deliver Sunlight After Dark
🔦 Spotlight
Hello, LA.
Most companies built around solar energy are trying to capture more sunlight.
Reflect Orbital wants to move it.
The Hawthorne-based startup is developing satellites equipped with large reflectors that could redirect sunlight from orbit to specific locations on Earth after sunset. The idea sounds borrowed from science fiction, but Reflect Orbital is getting closer to testing whether it can work at commercial scale.
This week, the company announced $73.5M in new funding, bringing its total raised to more than $100M. Existing investors Sequoia Capital, Lux Capital and Starship Ventures participated alongside new backers including Buckley Ventures, Convective Capital, The Uncommon Group and Salesforce Ventures.
The funding will support Reflect Orbital’s first satellite launches, continued development of its reflector technology and new commercial partnerships across the energy and lighting industries.
The company’s premise begins with a familiar limitation: Solar panels stop producing energy when the sun disappears below the horizon, often just as electricity demand is rising.
Reflect Orbital wants to extend that window.
Its planned satellites would remain in sunlight while orbiting Earth, then angle their reflectors toward selected areas on the ground. Solar farms could potentially generate electricity beyond daylight hours without acquiring more land or replacing their existing infrastructure.
The same technology could eventually illuminate disaster zones for search-and-rescue teams, help construction crews work more safely at night and provide light in places without reliable electrical infrastructure.
That is a considerable expansion from where the company stood two years ago.
Reflect Orbital raised a $6.5M seed round in 2024 to develop its production vehicles and grow its Hawthorne team. It followed that with a $20M Series A led by Lux Capital in May 2025.
Now, the company is preparing to leave the warehouse and test its technology where it was designed to operate.
Reflect Orbital has received Federal Communications Commission approval for its first demonstration mission, Eärendil-1, which is expected to launch in the second quarter of 2027. The satellite will allow the company to study how its reflector deploys and performs in low Earth orbit while gathering data that could shape future versions of the system. Reflect Orbital has also secured additional launch opportunities for 2027, including two dedicated missions with Skyroot Aerospace.
Building the satellites presents its own unusual manufacturing challenge. According to the company, its team produces reflector material 28 times thinner than a human hair, folds individual sections into packages roughly the size of a shoebox and assembles satellites containing approximately 12,000 parts.
In other words, delivering sunlight after dark requires some very careful folding.
The concept has naturally prompted questions from astronomers and dark-sky advocates about light pollution and potential interference with scientific observations. Reflect Orbital says it is designing the service around predictability, transparency and control, including limiting reflections to defined locations and short periods, publishing satellite positions in advance and avoiding observatories and other protected sites.
The demonstration mission is expected to produce illumination comparable to a full moon for no more than five minutes during the two hours following local sunset. Reflect Orbital has also said it will collect data, invite outside evaluation and use the results to refine both its technology and safeguards before attempting to scale.
That process will matter because Reflect Orbital is not simply building another satellite. It is proposing a new kind of infrastructure, one that could change when and where sunlight becomes available.
The company still has significant technical and regulatory work ahead. But it has already moved from an unconventional idea to more than $100M in funding, an approved demonstration mission and multiple launch opportunities.
The next step is proving that its technology can deliver light precisely, reliably and responsibly from hundreds of miles above Earth.
If it succeeds, the sun may no longer disappear from the energy grid when it drops below the horizon.
More from this week’s LA startup and venture scene below.
🤝 Venture Deals
LA Companies
- Helix raised $6.2M in a round led by Chicago Ventures, with participation from BAM Ventures, Aglaé Ventures, Corazon Capital and others. The startup is developing on-device voice technology that verifies whether users are human and estimates their age without collecting traditional identity documents, offering a privacy-focused alternative to CAPTCHA and photo verification. - learn more
- Opdo raised a $2.3M pre-seed round led by Angular Ventures, with participation from Inflection and Tiny.vc. The company uses AI agents alongside established optical-design software to help engineers develop and manufacture complex components faster, and will use the funding to expand its engineering capabilities, improve its AI tools and support more customer projects. - learn more
- Athlete To Athlete raised an $8M Series A led by Rally Ventures, with participation from Newbound VC, Scrum Ventures and UpHonest Capital. The platform pairs young athletes with college-athlete mentors for virtual one-on-one guidance and will use the funding to expand youth sports partnerships, strengthen participant safeguards and reach more families nationwide. - learn more
- Kindo raised $30M in a round co-led by Crosspoint Capital and Forgepoint Capital, bringing its total funding to $57.6M. The company provides a centralized platform for enterprises to monitor and control AI agents, including their data access, activity and costs, and will use the capital to expand sales and further develop its AI management and security products. - learn more
- Trousdale Ventures made a follow-on investment in Databento’s $100M Series C, which was led by Fifth Down Capital and valued the market-data company at $1.1B. Databento plans to accelerate its global infrastructure expansion and build a larger historical market-data archive as demand grows from financial institutions and AI companies. - learn more
- Upfront Ventures led General Translation’s seed round, while Andreessen Horowitz led its Series A, bringing the AI localization startup’s combined funding across the two rounds to $27M. The company is building full-stack infrastructure that helps businesses translate and continuously update apps, websites, documents and videos across languages. - learn more
- Alpha Edison participated in Q-CTRL’s $290M Series C, which was led by Salesforce Ventures. The quantum infrastructure company will use the funding to expand its AI-powered software for improving the performance and reliability of quantum computers and sensors while accelerating commercial adoption. - learn more
- KittyHawk Frontier participated in Twin1 AI’s $5M seed extension, which was led by Curql and brought the company’s total seed financing to $25M. Twin1 develops privacy-focused AI “digital twins” that preserve professionals’ knowledge and working context, and will use the capital to expand across credit unions, law firms and financial institutions while growing its teams and enterprise governance tools. - learn more
- Bonfire Ventures co-led Axle’s $9M funding round alongside Eniac, with participation from Teamworthy Ventures. Axle provides investment banks with a unified platform for managing conferences, corporate access, roadshows and expert engagements, and will use the capital to expand its AI capabilities and bring the product to more financial institutions. - learn more
- TenOneTen Ventures participated in Tristar AI’s $12.4M Series A, which was led by Isogon Ventures. The Cambridge-based company uses AI-powered visual inspection to identify manufacturing defects in real time and will use the funding to improve its vision and edge-computing platform, enter additional industries and support larger deployments across customer facilities. - learn more
- Clearlake Capital Group co-led Mirendil’s $1B Series A alongside Kleiner Perkins, with M13 participating among the company’s other new and existing investors. Mirendil is developing AI agents and tools that allow smaller teams to conduct advanced AI research and will use the funding to make frontier-level R&D more accessible to scientists and engineers. - learn more
- CommonKind VC participated in Akara’s $5.5M funding round, which was led by Locke Health and brought the healthcare technology company’s total funding to $12.3M. Akara combines privacy-preserving sensors, AI agents and robotics to give hospitals real-time visibility into clinical operations, and will use the capital to expand its teams, grow adoption across U.S. hospitals and further develop its physical AI platform. - learn more
- March Capital co-led Rox’s $100M Series B alongside General Catalyst, valuing the AI sales startup at $1.3B. Rox helps large enterprises automate pipeline generation, deal execution and upselling, and will use the funding to advance its AI models and expand across industries including healthcare, energy, financial services and manufacturing. - learn more
- Clocktower Technology Ventures participated in Palomma’s $10M Series A, which was led by Cometa and brought the Colombian fintech’s total funding to $14M. Palomma combines AI leasing software, rent payments and financial products for landlords and tenants, and will use the capital to expand in Colombia, develop additional services and prepare for entry into new markets. - learn more
- Alpha Edison led Agent F’s $4M pre-seed round, with participation from United Founders, Tiny Supercomputer Investment Company and several technology executives and founders. The Berlin startup is building AI-powered enterprise software that automates accounting, financial planning and compliance tasks for fast-growing companies while keeping finance professionals responsible for final approval. - learn more
- Bail Capital participated in Delix Therapeutics’ oversubscribed $100M Series C, which was co-led by Johnson & Johnson Innovation and SV Health Investors’ Dementia Discovery Fund. The neuroscience company will use the funding to advance its non-hallucinogenic depression treatment Zalsupindole into Phase II development and expand its broader pipeline of therapies for psychiatric and neurodegenerative conditions. - learn more
- M13 participated in Nominal’s $240M Series C, which was led by Lightspeed Venture Partners and co-led by Insight Partners at a $3B valuation. The hardware intelligence company will use the funding to expand its AI-powered engineering platform, develop new tools across the hardware lifecycle and enter additional industries and markets. - learn more
- MANTIS Venture Capital participated in Project Omega’s $80M Series A, which was led by B Capital. The nuclear technology company will use the funding to begin building a domestic fuel-recycling facility and advance long-duration power systems that transform materials recovered from used nuclear fuel into energy, reactor feedstock and strategic isotopes. - learn more
- Critical Frontier participated in Mavria’s latest funding round, which was led by Paradigm and valued the infrastructure startup at $1B. Mavria has raised $130M across its pre-seed and seed rounds to scale manufacturing, secure supply chains and build factory-produced data centers designed to bring AI computing capacity online faster and at lower cost. - learn more
Anduril Built Fighter Jets. Now It’s Making a Laptop.
🔦 Spotlight
Happy Friday, Los Angeles.
Anduril has built autonomous drones, underwater vehicles and fighter aircraft. Its newest product is considerably more familiar.
A laptop.
The Costa Mesa-based defense technology company announced this week that it is partnering with San Diego-based Qualcomm Technologies to launch BlueChip, a new line of computers designed in California and manufactured in the United States.
The first product will be a rugged laptop powered by Qualcomm’s Snapdragon X Series platform and built for customers in government, defense, public safety and other critical industries. Anduril has already produced working prototypes and plans to begin accepting orders in 2027.
At first glance, a laptop may seem like a modest addition to a company known for developing autonomous military systems. But BlueChip is less about entering the crowded consumer-electronics market and more about rebuilding the industrial foundation behind the machines Americans use every day.
The United States remains a leader in designing advanced technology, but much of the physical production required to turn those designs into finished computers has moved overseas. That includes not only semiconductor manufacturing, but also circuit boards, displays, batteries, enclosures and the network of specialized suppliers that connects them.
For most consumers, that dependency is largely invisible. For the government and military, it represents a potential vulnerability.
BlueChip is Anduril’s attempt to close that gap.
Components sourced from the United States and allied countries already account for more than 90% of the prototype laptop’s procurement cost. Circuit-board assembly is planned for Anduril’s Arsenal-1 facility in Ohio, while the company develops domestic production capabilities for enclosures, batteries and other hardware.
The goal is to gradually replace remaining foreign dependencies and create an end-to-end American computer supply chain that can support additional products beyond the first laptop.
That process requires more than moving an existing design into an American factory. Anduril is redesigning the computer around what domestic manufacturers can realistically produce at scale. The work includes selecting machinable American metals, adapting power systems to available battery technology and developing a bonding process for domestically made display glass.
In other words, Anduril is not simply assembling a laptop in America. It is working backward through the supply chain to make American assembly possible.
Qualcomm will supply the computing foundation. Its Snapdragon X platform will handle processing, graphics and on-device artificial intelligence, giving BlueChip users the ability to run certain AI models locally rather than sending sensitive information to the cloud.
That is particularly valuable for government and defense customers operating in secure environments, but it also reflects a broader shift in computing. As AI becomes embedded in everyday workflows, the location where information is processed may become nearly as important as the model doing the processing.
The partnership also reinforces Southern California’s growing role in the effort to rebuild American advanced manufacturing.
Anduril remains headquartered in Orange County, but its regional footprint is expanding. The company is investing $1B in a new campus spanning Long Beach and Lakewood that is expected to support approximately 5,500 jobs and include engineering, laboratory and prototype-manufacturing space.
Qualcomm, meanwhile, has spent decades building San Diego into a center for wireless technology and semiconductor design.
BlueChip brings those two Southern California strengths together: Anduril’s ability to move quickly from engineering concept to physical product and Qualcomm’s expertise in efficient, high-performance computing.
The first BlueChip laptop is not intended to compete for space in every backpack or coffee shop. Its early customers will likely be institutions that care deeply about security, reliability and control over their technology supply chains.
But the larger ambition reaches far beyond a single device.
If BlueChip succeeds, Anduril and Qualcomm will have created more than an American-made computer. They will have helped restore the suppliers, production knowledge and technical workforce required to build the next one.
For a company accustomed to tackling difficult national-security problems, the laptop may be one of Anduril’s most practical ideas yet.
Sometimes rebuilding an industry begins with reopening the machine.
More from this week’s LA startup and venture scene below.
🤝 Venture Deals
LA Companies
- StimCardio raised an oversubscribed $30M Series A led by Metis MedTech, with participation from Catalyst Health Ventures and other investors. The Los Angeles medical device company will use the funding to advance a pivotal study of Rhyvive, its investigational wrist-worn therapy designed to reduce recurring atrial fibrillation after catheter ablation, and prepare for an FDA submission. - learn more
- Gardena-based Neuron Industries raised an oversubscribed $10M seed round co-led by FCVC and Obvious Ventures, with participation from Y Combinator, Thin Line Capital, Zee Prime Capital and Founder Factor. The company will use the funding to develop and launch its AI-powered industrial control platform, expand its product line and establish domestic production as it works to help engineers automate new factories and machinery more quickly. - learn more
- Offe Market raised a $3M seed round led by Slauson & Co., bringing the off-price retail marketplace’s total funding to $4.3M. The company will use the capital to expand its commerce platform with AI-powered pricing and inventory tools, personalized recommendations and live shopping features designed to help brands sell excess merchandise without sacrificing control over presentation or pricing. - learn more
- Loamy raised a $6M seed round led by Zeal Capital Partners, with participation from LA investors Slauson & Co., Supply Change Capital and Amplify.LA, bringing its total funding to $10M. The company will use the capital to expand its engineering and sales teams, advance its AI platform and enter additional food categories as it helps growers, packers and distributors reduce waste and prevent rejected shipments. - learn more
- MaC Venture Capital co-led Rendezvous Robotics’ oversubscribed $20M seed round alongside Toyota Ventures, marking the space startup’s first priced financing. The company will use the funding to develop its next-generation modular spacecraft, expand its team and prepare for flight demonstrations of technology that allows spacecraft components to assemble and reconfigure autonomously in orbit. - learn more
- BOLD Capital Partners participated in General Compute’s $100M Series A, which was co-led by Blackbird and Abstract. The company will use the funding to scale its AI inference cloud, which deploys specialized chips from companies including Cerebras, SambaNova and Positron AI to help customers run AI workloads faster without managing the underlying infrastructure. - learn more
- Mantis Venture Capital participated in Vera Health’s $28.5M Series A, which was led by Threshold Ventures and brought the clinical AI company’s total funding to $32M. Vera will use the capital to strengthen its medical-evidence infrastructure, enter new healthcare markets and expand partnerships with medical societies, publishers and health systems. - learn more
LA Exits
- Breastfeeding platform Swehl was acquired by Willow Innovations alongside infant-feeding technology company Momtech, with financial terms undisclosed. Swehl’s educational resources and community programs will anchor Willow World, a new platform designed to expand Willow’s business beyond wearable breast pumps and support mothers across more of the postpartum journey. - learn more
- SmartLess Mobile was acquired by Noble Mobile and will transition to the Noble brand as the companies combine their efforts to offer simpler, more affordable wireless service. Existing customers will retain their plans, prices, phone numbers and T-Mobile 5G coverage, while gaining the ability to use their data in Mexico and Canada at no additional cost; financial terms were not disclosed. - learn more


