This week, I did my first Substack live, with Ricky Sutton of Future Media. So here it is - he was in sunny Sydney while I was in the dark in London at 7am. Rather annoyingly, my video kept freezing, however the sound is fine, so I thought I’d still share perhaps for you to listen to, rather than watch.
As a reminder, Netflix’s 2025 earnings were released this week, which included a few headlines:
$45.1bn in revenue, up 16% year on year; 29.5% profit margin
325m subscribers - as they no longer report on their subscriber numbers, the fact they included them is evidence it is considered a standout performance internally
$1.5bn on advertising income, with a target to double that in 2026
Increase content spend in 2026 to $20bn.
Here is a helpful visual from How They Make Money’s post Netflix:The Siege of Burbank
To put that in context, the annual revenues for their competitors include the following, although this is a ballpark comparison, as many haven’t reported for 2025, plus some don’t report on specific businesses such as YouTube, so these are analysts’ estimates:
Disney - $91bn
Amazon - $500bn+; advertising income - $56bn
YouTube - analysts expect $46bn in advertising for 2025
Meta Reels - reported a runrate of $50bn
TikTok - $17bn.
All this is against the backdrop of Netflix’s bid to buy Warner Bros., which is causing some disquiet amongst shareholders.
CNN: Netflix revises its offer for Warner Bros. Discovery. Now, it’s all cash
Hollywood Reporter: Netflix Surpassed 325 Million Subscribers at the End of 2025
Here are two share price visuals, the first over the last five days which had the earnings call and new offer for Warner Bros., the second is the last 12 months:
So, with all that in mind, hopefully the discussion covers useful ground for producers to consider. We touched on a whole host of topics around Netflix’s 2025 earnings, and not just about the streamer, but also:
Netflix’s competitive advantage
Business models and how to stay ahead on the age of disruption
Netflix and new strategies to be the entertainment brand of choice - podcasting, games, advertising
The battle to be the operating system of all our lives
How advertising changes businesses and the idea of customer exhaustion
Whether Netflix’s ad strategy will lead to more commissioning of the longer run series such as procedurals, sitcoms and soaps that thrived under the old syndication model
The value of the HBO machine (and apologies, I misspoke and referenced Breaking Bad which obviously is an AMC show!)
Netflix’s potential vulnerability against competitors who are more diversified
Why hasn’t Netflix entered the cloud streaming business like Amazon Web Services?
Who would you bet on being the winner in terms of being the everything platform
Amazon is the dark horse of the streaming.
For more, here are couple of items worth your time - firstly Emily Horgan on Netflix’s engagement numbers and kids content:
Media industry analyst Ian Whittaker and advertising expert Justin Lebbon have launched a podcast which looks at the media industry from the financial markets perspective - here is their first episode, which includes a section on Netflix and Warner Bros (from 26 mins).
Lastly here is the interview with Ted Sarandos and Greg Peters around these earnings:
