Netflix expects to roughly double advertising revenue in 2026 to reach $3 billion. And in support of that growth path, continues to expand means for advertisers – most recently with audience targeting and outcomes measurement capabilities announced Wednesday.
Expanded targeting tools are coming in Q2 to the U.S. with access to audience segments and data through the Amazon DSP and Yahoo DSP.
Specifically, advertisers can tap into Amazon Audiences to inform programmatic ad buys on Netflix, with segments based on audience behavior informed by Amazon’s shopping, streaming and browsing signals. Netflix first partnered with the Amazon DSP for programmatic ad buying last September.
Per Netflix, this means advertisers can better reach their intended or relevant Netflix audiences based on interests and products they actively shop for.
Advertisers buying Netflix through the Yahoo DSP can also activate deterministic audiences – also informed by behavioral, purchase and life stage signals.
In addition, Netflix is upping its came to better prove results to advertisers from their campaigns on the SVOD – at a time when attention in the CTV space is more broadly turning to outcomes and marketers are seeking fuller-funnel impacts from investments.
To do so, Netflix is now offering its own Conversion API (CAPI) tools, which the company said is designed to help advertisers “prove outcomes and will leverage real-time insights to optimize campaigns.”
It follows a partnership with full-funnel marketing agency Tinuiti earlier this year for early testing, which according to Netflix “saw great attribution results” as campaigns outperformed benchmarks by more than 75% across financial services, ed tech and retail clients.
The expanded ad capabilities will roll out to other countries where Netflix’s ad tier is available later this year.
“These advancements are part of our ongoing effort to make advertising on Netflix more effective and easier to buy,” wrote Netflix. “We’re offering our brand partners clearer ways to reach the right audiences, while maintaining the high-quality experience our members expect.”
Netflix’s advertising ambitions are now in their fourth year, but as industry analyst TVREV’s Alan Wok has suggested – the ads plan is “still largely a cipher despite being key to Netflix’s future” – in part due to a lack of clarity around exactly just how many ad plan members it has and where around the globe they’re located.
In November, the company did disclose more than 190 million monthly active viewers (MAV) of ads on Netflix globally – a new metric at the time it said reflects the scale of the ads business. The MAV metric is defined as members who have watched at least one minute of ads on Netflix per month, which is then multiplied by the estimated average number of people in a household based on Netflix first-party research.
Still, speaking at the Morgan Stanley TMT Conference Wednesday, Netflix CFO Spencer Neumann said the company continues to grow its ads business in a healthy way, and the forecasted revenue growth is “a result of the fact that advertisers are pleased with the things we’ve delivered on.”
Some of those things include increasing scale, with Neumann saying the SVOD has “gone beyond kind of critical scale in all of our ads markets,” as well as delivering a highly attentive and engaged audience with a strong slate of content titles.
It’s also the first full year that Netflix is using its own in-house ad tech stack, which he said brings capabilities to market quicker. Some benefits of an in-house tech stack for Netflix are that it’s able to deliver more ad products, bring together more partners like external DSPs, and integrate more programmatic capabilities and data.
“All of that stuff allows us to bring more demand into the system,” Neumann said. “We increased fill rate last year, we’ll continue to increase fill rate this year.”
Although he did note Netflix doesn’t manage fill rates but rather overall ad revenue, while also working to maintain premiums in the marketplace.
And the ads business is certainly one of its growth avenues.
Given Netflix’s overall guidance of around $6 billion in incremental revenue the year, Neumann pointed out that the expected uptick of $1.5 billion of advertising revenue year-over-year means the ads business would contribute 25% of that growth figure.
In its quarterly letter to shareholders, the SVOD giant also disclosed testing new AI tools to help advertisers create custom creative spots based on Netflix IP, an effort it plans to build on in 2026.