"For years, top Netflix executives insisted that the platform would always remain free of ads. But in the fast-moving world of tech and entertainment, being able to change company policies as per requirements is a necessity. So while many viewed Netflix's decision to introduce an ad-supported tier with skepticism, the decision turned out to be a savvy business move. During Netflix's earnings conference call yesterday, the company said that ad revenue on the platform during the most recent quarter set a new record."
"Not only that, but if the current trajectory stays put, Netflix co-CEO Greg Peters said that ad revenue for the year is poised to be double that of 2024. What's more, Peters added that the rate of ad deals with corporate buyers is accelerating and that the streaming giant is seeing a boost in ad revenue as the company adds more avenues for ad buys and metrics for performance analysis."
"Back in 2015, Netflix ran a little test where it added skippable promos for its own original programming between episodes of popular shows. Consumers were so outraged that Netflix CEO Reed Hastings, in response to the controversy, penned a Facebook post where he emphatically stated: "No advertising coming onto Netflix. Period." During an interview five years later, Hastings even explained why Netflix will never have commercials."
Netflix's ad-supported tier generated record ad revenue in the most recent quarter. Co-CEO Greg Peters projected that annual ad revenue could be double 2024's figure if the current trajectory continues. The rate of ad deals with corporate buyers is accelerating as the company adds more avenues for ad buys and metrics for performance analysis. Netflix plans to introduce interactive ads and experiment with different ad formats later this year. September quarter revenue totaled $11.5 billion, a 17% year-over-year increase. Netflix historically shifted its business model from DVD-by-mail to digital streaming and later adapted its advertising stance.
Read at BGR
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