Netflix’s push into live programming is paying off with advertisers even as it appears to be denting how many hours members spend watching the platform overall, executives said on the company’s latest earnings call.
The streamer posted second-quarter revenue of $12.6 billion, up 13% year over year, with the company crediting membership growth, pricing adjustments, and continued advertising momentum. Guidance for the third quarter calls for another 12% revenue increase driven by the same three factors. Despite results that matched Wall Street’s expectations, Netflix shares slid after the report as analysts pressed executives on signs that engagement is cooling.
Netflix reaffirmed it remains on pace to bring in $3 billion in advertising revenue this year, which would roughly double what it collected in 2025. The company is currently in the closing stretch of its U.S. upfront negotiations, the annual process where advertisers lock in major ad commitments ahead of the coming season.
A big part of that advertiser appetite is coming from live programming, especially sports. Netflix has been leaning into events like the Women’s World Cup and a growing NFL package, tapping into a broader surge of interest in live sports across the TV industry. Rivals are moving in a similar direction: Amazon reportedly closed out its own upfront discussions earlier in the week, according to Adweek.
Even so, Netflix executives acknowledged the company still generates less revenue per member on its ad-supported tier compared with its ad-free option. Co-CEO Greg Peters said the company expects to narrow that gap by improving its measurement tools, expanding ad products, and building out its advertising infrastructure, adding that easier transacting for advertisers should drive demand, competitiveness, and higher fill rates. He described those improvements as the main lever for boosting monetization over the next several years.
Beyond sports, Netflix has also been experimenting with branded integrations tied to original series. The new Will Ferrell golf comedy “The Hawk” launched alongside custom campaigns from Hyundai’s Genesis brand and Mike’s Hard Lemonade, both woven directly into the show.
On the engagement side, executives faced questions about declining viewing hours per member. Reporting from Bloomberg has pointed to more subscribers dropping shows after a single season. Co-CEO Ted Sarandos pushed back on concerns about that trend, saying season-over-season audience drop-off is typical and that second seasons are performing within the company’s expected range.
Executives also pointed to Netflix’s growing emphasis on live events as a factor behind the softer viewing-hours numbers. Live programming draws intense attention and commands steep licensing costs, but only airs in short windows compared with an ongoing series. Peters said live events help with subscriber acquisition, monetization, ad revenue, and brand exposure, though they don’t generate as many total viewing hours as traditional content.
