Netflix has used generative artificial intelligence to create visual effects in one of its original TV shows for the first time, as part of a wider strategy to reduce production costs and accelerate timelines.
The streaming giant revealed that AI technology was used to produce a complex scene in its new Argentine sci-fi drama The Eternauts, featuring the collapse of a building in Buenos Aires. The sequence marks the first use of final AI-generated footage in a Netflix original film or series.
Co-chief executive Ted Sarandos said the decision to use generative AI—software capable of creating images and video based on text prompts—enabled the production team to deliver the effects ten times faster than through traditional VFX method “The cost of it just wouldn’t have been feasible for a show in that budget,” Sarandos said. “That sequence is the very first generative AI final footage to appear on screen in a Netflix original series or film. The creators were thrilled with the result.”
The announcement comes as Netflix posted a 16% year-on-year increase in revenue, reaching $11 billion (£8.25 billion) for the quarter ending June 30. Profits surged from $2.1 billion to $3.1 billion, buoyed by the release of the third and final season of Squid Game, which has drawn over 122 million views to date.
While Netflix’s use of AI has drawn praise for its innovation and cost-efficiency, the move also reopens debate about AI’s role in creative industries. Critics argue that generative AI often learns from existing artistic works without the consent of their creators, and that increasing use of automation could displace human artists and technicians.
Concerns over AI were central to the Hollywood strikes of 2023, during which the Screen Actors Guild–American Federation of Television and Radio Artists (SAG-AFTRA) called for stricter regulation around AI’s use in film and television.
Netflix, however, has positioned its deployment of AI as a tool to democratise access to advanced visual effects—especially for lower-budget productions.
“It’s about enabling storytelling that otherwise wouldn’t be possible,” Sarandos added. “We’re not talking about replacing creativity, but enhancing it with the right technology.”
The integration of generative AI into Netflix’s pipeline signals a potential shift in how streaming giants balance production ambition with economic discipline. With increasing pressure to produce blockbuster content at scale, AI could become a core part of the toolkit for mid-tier and international series.
As studios face rising costs, tighter profit margins, and evolving viewer expectations, the question is no longer whether AI will reshape entertainment—but how far, how fast, and on whose terms.
Jamie Young
Jamie is Senior Reporter at Business Matters, bringing over a decade of experience in UK SME business reporting.
Jamie holds a degree in Business Administration and regularly participates in industry conferences and workshops.
When not reporting on the latest business developments, Jamie is passionate about mentoring up-and-coming journalists and entrepreneurs to inspire the next generation of business leaders.
