Maya Robertson
Netflix closed 2025 with stronger-than-expected financial results, driven in part by rapid growth in its advertising business, while also moving to accelerate its proposed acquisition of Warner Bros. Discovery’s assets.
In its full-year earnings update, Netflix reported total revenue of approximately $45 billion for 2025, marking a 16% year-over-year increase. Advertising contributed about $1.5 billion to that figure, more than doubling from the prior year. While advertising remains a relatively small share of Netflix’s overall business, executives described the ad-supported tier as having reached sufficient scale to shift focus toward higher monetization.
During an investor call, company leadership said Netflix expects advertising revenue to nearly double again in 2026, targeting around $3 billion. The company has not disclosed updated subscriber figures specifically for its ad-supported plan, though it previously reported roughly 190 million monthly active viewers on that tier as of late 2025. Overall paid memberships reached 325 million by the end of the year.
To support further growth, Netflix said it plans to expand its advertising product offering throughout 2026. This includes making more first-party data available to advertisers under privacy-focused controls, rolling out additional interactive and AI-driven ad formats, and continuing development of its in-house ad tech stack. Executives said these changes are aimed at improving ad performance, increasing fill rates, and raising revenue per member.
Netflix also used the earnings update to outline changes to its pending deal involving Warner Bros. Discovery. The streamer revised its proposed acquisition to an all-cash offer valued at roughly $72 billion, replacing a previously announced cash-and-stock structure. According to Netflix, the revised terms are intended to speed up the shareholder approval process and reduce deal uncertainty.
The company said the transaction would expand its access to film and television intellectual property and increase production capacity, including theatrical releases with exclusive windows. Netflix indicated it is in ongoing discussions with regulators in the United States and Europe and has submitted the required merger filings.
Beyond advertising and M&A activity, Netflix reiterated plans to broaden its content lineup, with additional live sports, licensed programming, and international production. Executives noted that despite its scale, Netflix still accounts for less than 10% of total TV viewing in many key markets, highlighting continued competition for audience attention and advertising budgets—particularly with platforms such as YouTube.
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