Netflix plans to test, innovate ad formats in 2026; Q3 revenue up 17%
Netflix's Q3 earning 2025: Revenue from sales and marketing climbed 22.2% YoY to $786 million in Q3 2025, against $643 million in Q3 2024.
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Netflix on Thursday reported its third-quarter results for 2025, posting a 17% year-on-year (YoY) rise in consolidated revenue to $11.51 billion, compared to $9.82 billion in the same period last year.
The streaming giant’s net income grew 8% YoY to $2.5 billion, while net cash generated from operating activities increased to $2.8 billion, up from $2.3 billion a year ago.
Revenue from sales and marketing climbed 22.2% YoY to $786 million in Q3 2025, against $643 million in Q3 2024.
Netflix said the quarterly growth was fueled by strong membership additions, higher ad revenues, and a series of price hikes across markets. The company’s ad-supported plan, launched in late 2022, has now achieved "significant scale" across 12 markets, including the US, UK, Japan, and Germany.
The company said it is leveraging AI to develop new ad formats, improve creative placement, and accelerate media planning. By 2026, Netflix expects to “test, iterate, and innovate” on dozens of ad formats using AI.
"In Q4, we are using AI to test new ad formats, to generate the most relevant ad creative and placement for members, and for faster development of media plans. With these advancements, we’ll be able to test, iterate, and innovate on dozens of ad formats by 2026," it mentioned.
Further, Netflix has anticipated Q4 revenue growth of 17%, driven by continued expansion in members, pricing, and ad sales. The company also projected an operating margin of 23.9% for the quarter, a two-percentage-point improvement YoY.
For the full year, Netflix forecasted $45.1 billion in revenue--up 16% and an operating margin of 29%, slightly below its earlier guidance of 30%.
