Netflix has reported a 16% year-over-year revenue increase for the second quarter of 2025, reaching $11.079 billion. The company also saw its operating margin grow by seven percentage points to 34%, while diluted earnings per share rose 47% to $7.19. On the back of these results, Netflix raised its full-year revenue guidance to between $44.8 billion and $45.2 billion—up from the previous estimate of $43.5 billion to $44.5 billion.
The revised outlook also includes an increase in projected free cash flow for the year, which is now expected to reach $8.5 billion, up from the earlier forecast of $8 billion. This boost reflects confidence in continued subscriber growth and a notable upswing in ad-based revenue, although Netflix acknowledged some external variables, including exchange rate fluctuations, particularly the strength of the U.S. dollar, which remain out of its control.
Despite the gains, Netflix anticipates a dip in operating margin during the second half of the year due to heavier content-related expenses. A larger and more varied content slate will increase amortization and marketing costs, impacting profitability in the coming quarters.
One of the core drivers of revenue growth has been the continued expansion of Netflix’s advertising business. The company completed the rollout of its first-party advertising platform, Netflix Ads Suite, across all ad-supported markets. It has also integrated Yahoo’s Demand-Side Platform (DSP) into its programmatic ecosystem. This allows advertisers to manage ad buys across multiple publishers via a centralized interface, supported by machine learning and behavioral targeting powered by first-party data.
Netflix expects these ad infrastructure improvements to help it double ad revenue in 2025. While the company continues to raise subscription prices, it stated that user metrics such as acquisition, churn, and plan mix are tracking in line with internal forecasts—suggesting that recent price hikes have not significantly deterred growth.
In terms of content performance, Netflix saw strong engagement with several original series and films in Q2. Squid Gameseason 3 topped the list with 122 million views, followed by Tyler Perry’s STRAW at 109 million, Exterritorial with 89 million, Sirens at 56 million, and Ginny & Georgia season 3 drawing 53 million views. Notably, non-English language content continued to play a major role, accounting for more than one-third of total viewing hours during the first half of the year.
Looking ahead, Netflix is betting on a packed release calendar to maintain momentum. Major upcoming titles include Wednesday season 2, the long-awaited Stranger Things finale, Happy Gilmore 2, and live sports broadcasts such as the Canelo-Crawford boxing match and NFL Christmas Day games. The company is also rolling out a redesigned homepage, intended to improve content discovery and overall user experience.
As Netflix continues to diversify its revenue streams through advertising, international content, and selective pricing adjustments, the streaming giant remains focused on balancing growth with cost discipline—particularly as competition intensifies and consumer viewing habits evolve.
