Goncalo Ramos gave Benfica the lead after 15 minutes as he headed the ball in from Joao Mario’s corner.
But the advantage didn’t last long as Miguel Almiron started and finished a fine attacking move to turn the ball in from Kieran Trippier’s cross.
Benfica restored their advantage as Alex Grimaldo curled a 25-yard free-kick into the top right corner of the goal.
But Trippier and Almiron combined again as the Paraguayan levelled the score at 2-2 going in at half-time.
Newcastle finished the match with 10 men after Joelinton was shown a second yellow card with nine minutes remaining.
Benfica made their man advantage count in the final minute of normal time as Henrique Araújo stroked home to make it 3-2.
17. Jonjo Shelvey - 8
On for S.Longstaff 46: Sprayed the ball around well and picked out a great pass for Murphy who couldn’t convert the chance. Hobbled off injured with 15 minutes to go after a very solid midfield display. Photo: Ian MacNicol
18. Joelinton - 5
On for Guimaraes 46: Another wholehearted pre-season display ended in a sending off following two yellow cards in quick succession. Photo: Stu Forster
19. Joe Willock - 6
On for Anderson 46: Found pockets of space between the midfield and attack well without posing much of a threat. | Getty Images
20. Jacob Murphy - 5
On for Almiron 46: Was originally meant to start the game before Almiron came into the side in his place to make a great impact. Had a good chance to give Newcastle the lead in the second half but was denied by the goalkeeper. | Getty Images