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Outbyte PC Repair FREERepair Windows errors before they cause bigger problemsFix Now →Outbyte Driver Updater FREEScan for outdated or missing drivers - takes under a minuteDriver Scan →Netflix makes most of its money from monthly streaming memberships. Advertising adds a second revenue stream, while consumer products, live experiences and other activities contribute much smaller amounts. In its July 16, 2026 shareholder letter, Netflix reported $12.56 billion in second-quarter revenue and said growth was driven primarily by membership growth, pricing and increased ad revenue.
Where does Netflix’s revenue come from?
Netflix’s 2025 Form 10-K says revenue is primarily derived from monthly fees for streaming memberships. The company also earns advertising revenue and money from consumer products, live experiences and other activities. Netflix reported $45.183 billion in 2025 revenue, up 16% from 2024; it attributed the increase primarily to membership growth, price increases and higher advertising revenue, partly offset by foreign-exchange changes net of hedging. Netflix 2025 Form 10-K
How do Netflix memberships generate revenue?
Members are billed in advance, but Netflix recognizes membership revenue over each monthly service period. The timing distinction matters: advance payment does not mean Netflix records the entire amount as revenue immediately.
Netflix offers different plan prices and periodically adjusts them. The company says it tests plans and price points to understand demand, and that its primary focus is long-term revenue maximization while also caring about membership growth. Revenue growth, it says, enables investment in content and service improvements as well as profits for shareholders. Netflix investor FAQ
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Does Netflix make money from ads?
Yes. Netflix sells advertising shown on its streaming service. An ad-supported membership is still a paid subscription: the member’s fee and the advertising sold against viewing are distinct revenue streams. The ad option can provide a lower-priced choice for consumers while giving Netflix another source of revenue and profit. Netflix Q2 2026 Shareholder Letter
Netflix’s letter described ad-member growth, improving ad fill rates and maintaining strong CPMs—the price advertisers pay per thousand impressions—as drivers of longer-term advertising growth. It also cited its programming slate, advertising technology, Netflix Ads Suite, AI-powered ad tools and broader programmatic access.
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Reported revenue versus 2026 forecasts
| Figure | Status and period |
|---|---|
| $12.56 billion | Reported revenue for Q2 2026; up 13.4% year over year, according to Netflix’s July 16, 2026 shareholder letter. |
| $51.0–$51.4 billion | Netflix management’s full-year 2026 revenue forecast in the July 16, 2026 shareholder letter; not a reported final result. |
| Approximately $3 billion | Netflix management’s full-year 2026 advertising revenue forecast in the July 16, 2026 shareholder letter, roughly double the prior year; not a reported final result. |
The company’s latest letter does not provide an exact reported advertising revenue amount separable from total revenue. The approximately $3 billion figure is a forecast, not a disclosure of final 2026 ad sales.
Are subscriptions still Netflix’s main source of income?
Yes. Netflix’s filing identifies monthly membership fees as its primary revenue source. Advertising is an additional and growing stream, but the company’s reported results and forecasts should not be read as evidence that ads have displaced subscriptions as the core business.
What about merchandise, live events and other activities?
Netflix also earns revenue from consumer products, live experiences and various other sources. Its 2025 Form 10-K says sources other than monthly membership fees were not a material component of revenue in 2023, 2024 or 2025. These activities are supplemental, not equivalent in scale to memberships.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.How do partners and bundles affect Netflix revenue?
Electronics manufacturers, multichannel video distributors, mobile operators and internet service providers may partner with Netflix to provide access. In a bundle where the partner sets the price and there is no standalone Netflix price, Netflix recognizes as revenue the net amount collected from that partner. The cash may therefore flow through a distributor or operator rather than directly from the viewer, and accounting depends on the terms of the bundle. Netflix 2025 Form 10-K
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