Netflix has debuted its first use of generative artificial intelligence in an original production, signaling a major shift in the streaming giant’s approach to content creation.

The milestone was announced by Co-CEO Ted Sarandos during the company’s Q2 earnings call on Thursday. The AI technology was used in The Eternauts, a new Argentine science fiction series, to produce a complex visual effects sequence depicting a building collapse in Buenos Aires.

“This was the first generative AI final footage to appear on screen in a Netflix original,” Sarandos said. “The scene was completed ten times faster than using traditional VFX methods, and the creators were thrilled with the result.”

The use of AI helped keep the effects-heavy sequence within budget, underscoring what Netflix says is a practical benefit of adopting new technologies. Generative AI—capable of creating images and videos from simple text prompts—has become increasingly controversial in the entertainment industry.

Critics warn that it could displace artists, reuse their work without consent, and upend creative labor. Such concerns were at the heart of the 2023 SAG-AFTRA strikes, which saw writers and actors demand protections from unchecked AI use.

Industry reactions remain mixed. Davier Yoon, co-founder of animation studio CraveFX, noted the upside: “AI opens the door for smaller studios to achieve blockbuster-level visuals. But at the end of the day, it’s still the artist who decides what appears on screen.”

Others remain cautious. In 2024, filmmaker Tyler Perry paused an $800 million studio expansion, citing concerns that emerging AI tools like OpenAI’s Sora could threaten creative jobs.

Netflix’s announcement came alongside strong quarterly results. The company reported a 16% year-on-year revenue increase to $11 billion, with profits rising from $2.1 billion to $3.1 billion. Squid Game Season 3 was a major driver, drawing 122 million global views.