Todd Spangler NY Digital Editor Netflix touted strong momentum for its push into advertising, claiming subscribers on its ad-supported tier nearly doubled in the second quarter of 2023.
However, the streamer said, advertising revenue in Q2 was still not material in the context of its overall business. The company announced Q2 earnings Wednesday.
Overall, Netflix netted 5.9 million new paid subscribers, amid its broader crackdown on password-sharing violators. On the ad front, “While we continue to grow our reach — ads plan membership has nearly doubled since Q1 — it’s still off a small membership base, so current ad revenue isn’t material for Netflix,” the company said in its quarterly letter to shareholders. “Building an ads business from scratch isn’t easy and we have lots of hard work ahead, but we’re confident that over time we can develop advertising into a multibillion-dollar incremental revenue stream.” In mid-May, Netflix said it had signed up more than 5 million members for its ad-supported plans, with 25% of new subs taking the package.
Netflix launched the ad tier eight months ago in partnership with Microsoft, coming after years of execs insisting they had no intention of going into the advertising business.
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