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Netflix’s Ad Push and Global Expansion Lift Margins Sharply

New first‑party ad tools position Netflix to capture more of the advertising value chain.

Overview

  • Netflix reports more than 300 million paid memberships across over 190 countries.
  • About 94 million users are on the ad-supported plan, roughly 30% of the base, with management saying ad revenue doubled in 2024 and is on track to double again in 2025.
  • Operating margin rose to 34.1% in Q2 2025 from 27.2% a year earlier, and free cash flow increased to $2.3 billion.
  • The company launched its Netflix Ads Suite and added Yahoo DSP to expand programmatic buying, targeting, and measurement.
  • Revenue growth is strongest outside North America, with Asia-Pacific and Latin America each up 23% year over year on an FX-neutral basis versus 15% in the U.S.