Netflix Ad Revenue Hits $1.5 Billion, Eyes $3 Billion Goal

Netflix's advertising business has achieved a significant financial milestone, generating $1.5 billion in revenue during 2025. This represents a dramatic increase from the previous year, as the company's ad-supported streaming model continues to gain widespread adoption.

The streaming giant's co-CEO, Greg Peters, announced during a recent earnings call that the company is on track to nearly double this figure again in the coming year. This growth trajectory highlights the increasing importance of advertising revenue to Netflix's overall business strategy.

The advertising business more than doubled its revenue from 2024 to 2025, climbing to $1.5 billion. This substantial jump underscores the success of Netflix's strategic pivot toward incorporating advertising into its streaming platform.

During the earnings call, co-CEO Greg Peters outlined the company's ambitious outlook for the advertising division. He stated that Netflix expects this business segment to roughly double again in 2026, targeting approximately $3 billion in revenue.

We expect that [advertising] business to roughly double again in '26 to about $3 billion.

The earnings call occurred on Tuesday, positioned strategically hours before Netflix's live viewer voting-enabled Star Search event. This timing allowed the company to showcase both its financial performance and its innovative interactive features simultaneously.

The revenue surge is directly linked to the expanding reach of Netflix's ad-supported streaming subscription. The company's $7.99 per month plan has become a key driver of this growth, attracting millions of users globally.

As of May 2025, this affordable tier reached more than 94 million people each month. This massive user base provides a substantial platform for advertisers seeking to reach a diverse, engaged audience.

The success of the ad-supported plan demonstrates a strong market demand for lower-cost streaming options. It also validates Netflix's decision to introduce an advertising tier alongside its traditional subscription models.

Netflix's leadership views the advertising division as a critical component of the company's future. Co-CEO Greg Peters expressed confidence in the division's trajectory, emphasizing the scale of the opportunity ahead.

We're making good progress, and the opportunity ahead of us is massive.

This statement reflects the company's strategic focus on diversifying revenue streams beyond traditional subscription fees. The advertising business now represents a significant and growing portion of Netflix's financial portfolio.

The ability to generate substantial revenue from advertising while maintaining a lower-priced subscription option creates a dual benefit. It expands market reach to price-sensitive consumers while opening a new, lucrative revenue channel from advertisers.

The $1.5 billion revenue figure positions Netflix as a formidable player in the digital advertising market. This achievement comes as the broader streaming industry continues to evolve, with many platforms exploring ad-supported models to boost profitability.

Netflix's rapid scaling of its advertising business demonstrates the platform's ability to leverage its vast content library and global subscriber base. The company's interactive features, such as the live viewer voting in Star Search, further enhance the value proposition for advertisers seeking engaged audiences.

The projected growth to $3 billion in 2026 suggests that advertising could become an even more central pillar of Netflix's business model. This trajectory may influence how other streaming services approach their own advertising strategies.

Netflix's advertising revenue milestone marks a pivotal moment in the company's evolution from a pure subscription service to a hybrid model. The $1.5 billion generated in 2025 establishes a strong foundation for future expansion.

With plans to reach $3 billion in 2026, Netflix is positioning its advertising business as a major growth engine. The combination of a large, engaged user base and a clear strategic vision suggests continued momentum in this sector.

The success of the $7.99 per month ad-supported plan proves that consumers are receptive to advertising in exchange for lower costs. This insight will likely shape Netflix's product development and pricing strategies in the years to come.