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6d ago

Netflix Q1 2025 Earnings Beat Expectations, Driven by Ad-Supported Growth

The streaming giant reports 12.5% revenue growth, launches in-house ad platform, and raises Q2 guidance as shares climb 3%.

The Netflix logo is shown on one of their Hollywood buildings in Los Angeles, California, U.S., July 12, 2023. REUTERS/Mike Blake/File Photo
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Greg Peters, co-CEO of Netflix, says low-cost ad plans give company more resilience. Photo: Akio Kon/Bloomberg via Getty Images
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Overview

  • Netflix reported Q1 2025 revenue of $10.54 billion, up 12.5% year-over-year, with an operating margin of 31.7% and EPS of $6.61.
  • The ad-supported tier accounted for 55% of new sign-ups, highlighting its role as a key growth driver since its late 2022 debut.
  • The Netflix Ads Suite, now live in the U.S. and Canada, is projected to double the company's ad revenue by the end of 2025.
  • Management reaffirmed its 2025 revenue forecast of $43.5–44.5 billion and issued Q2 guidance for 15.4% growth to over $11 billion.
  • Shares rose 3% in premarket trading, with several analysts raising price targets, reflecting confidence in Netflix’s dual-revenue strategy.