Netflix's ad business accelerates as Q2 revenue hits $12.6bn
Updated: Sep 1
Netflix's transformation from subscription-only service to genuine advertising player took another step forward with its second-quarter 2026 results, reported on 16 July. The streaming giant booked revenue of $12.6bn, delivered an operating margin of 33.4% and posted net profit of around $3.4bn — and, crucially for marketers, confirmed its advertising business remains on track to roughly double this year to about $3bn.
Advertising moves to centre stage
When Netflix launched its ad-supported tier, sceptics questioned whether a company built on the promise of uninterrupted viewing could make advertising work. Two years on, the ad tier has become one of the most closely watched growth stories in media. The pitch to advertisers is potent: premium, brand-safe content, a hard-to-reach audience, and the targeting and measurement expectations of digital rather than legacy TV.
The challenge now is supply, not demand. Analysts have noted that Netflix's ad ambitions are increasingly constrained by available inventory — there is more advertiser appetite than there are impressions to sell against, a rare and enviable problem. Expanding that inventory, through subscriber growth on the ad tier and new formats, is the key to hitting bigger numbers.
A cooler note on growth
Not everything landed perfectly. Netflix's shares fell around 8% after the results as investors focused on a more cautious outlook for the next quarter and signs that headline growth is moderating from its recent highs. The company narrowed its full-year revenue range, a signal of confidence in the destination even as the pace settles.
For UK advertisers and media planners, the direction of travel is unmistakable. Connected TV is no longer an experimental line item, and Netflix is fast becoming a fixture on the plan alongside broadcaster VOD and YouTube. The brands building CTV competence now — the creative, the measurement, the audience strategy — will be the ones best placed as this inventory scales.
Netflix having more advertiser demand than inventory tells you everything about where attention has moved. The living-room screen is back at the heart of the media plan, but on streaming's terms. UK brands that still treat connected TV as an afterthought are going to find themselves queuing for space that's already been claimed.
— Oliver Nikolla-Casado, International Markets Reporter at Marketing Minute
Connected TV's problem is no longer proving demand — it's finding enough inventory to meet it.
Where does streaming sit in your media plan — a core channel, or still an experiment?
If you would like to know more about this topic, please contact us on danieln@merxmarketing.co.uk
Related reading
Written by Oliver Nikolla-Casado, International Markets Reporter at Marketing Minute
Comments