Amazon Partnership Impact on Netflix’s Ad Revenue Targets

Netflix’s recent partnership with Amazon Ads is making waves in the streaming world, opening up new advertising opportunities for the popular platform. This collaboration means that advertisers will now have direct access to Netflix’s premium ad inventory through Amazon’s demand-side platform in 11 major markets, including the US, UK, Japan, and Brazil.

This move represents a big step forward for Netflix, as they expand beyond their initial partnership with Microsoft. By teaming up with Amazon, Netflix can leverage the advanced targeting capabilities and insights of Amazon’s platform to reach their 94 million ad-supported users around the world. Since launching their ad-supported tier in November 2022, Netflix’s user base has grown significantly, making this partnership all the more exciting.

Netflix has been seeing success with their ad-supported tier, with a 2024 doubling of ad revenues and projections for another doubling in 2025. This ad-supported tier has been particularly popular with consumers looking for a more budget-friendly option, priced at $7.99 per month compared to $17.99 for ad-free viewing.

The timing couldn’t be better for Netflix, with their second-quarter 2025 results showing strong revenue growth and prompting an increase in full-year guidance. The Amazon partnership also positions Netflix to tap into the $25 billion connected TV advertising market, further solidifying their presence in the industry.

This partnership with Amazon has put pressure on competitors like Disney and Warner Bros Discovery to up their game in terms of programmatic advertising capabilities. While each platform has its strengths, Netflix’s combination of Amazon’s reach, existing partnerships, and large ad-supported user base gives them a competitive edge in the market.

Overall, investors see this collaboration as a strategic move for Netflix, helping them transition from a subscription-based model to a more diversified revenue stream. It will be interesting to see how this partnership continues to shape the streaming landscape in the future.