- Staggering Reach: Netflix’s ad-supported plan reached over 190 million monthly active viewers (MAVs) globally in October, signaling a massive audience for advertisers.
- New Measurement: The streaming giant has controversially replaced its “monthly active users” (MAUs) metric with the new “monthly active viewers” (MAVs) to provide a more comprehensive count of everyone watching, not just account holders.
- Strategic Shift: This move comes as Netflix doubles down on its advertising ambitions as a key growth driver, especially after the company missed profit and revenue estimates in its last quarter.
- Future Growth: Despite recent stumbles, Wall Street projects Netflix’s ad revenue is on track to more than double in 2025 and potentially exceed $4.2 billion by 2026.
Netflix Overhauls Ad Metrics Amidst Growth Push
In a significant strategy shift that has the streaming world talking, Netflix announced it will no longer use its long-standing metric for ad-tier performance. The company revealed its ad offerings reached more than 190 million monthly active viewers (MAVs) in October, a staggering number unveiled alongside the rollout of this new measurement system. The move signals Netflix’s aggressive push to scale its advertising business and provide more enticing data for corporate partners.
Why the Sudden Change?
For years, Netflix tracked its ad performance through “monthly active users,” or MAUs, which stood at 94 million as of May. However, the company now argues this metric was an inaccurate representation of its true audience. The new MAV metric aims to capture a more holistic picture by estimating the average number of people per household who are actually watching the content.
“Our previous measurement (which was based on account profiles) didn’t represent all of the engaged people who are in the room watching,” explained Amy Reinhard, Netflix’s President of Advertising, in a blog post. “Our move to viewers means we can give a more comprehensive count of how many people are actually on the couch.” This provides advertisers with a clearer, more transparent view of who their campaigns are reaching.
A Strategic Pivot After Financial Stumbles
The announcement isn’t just a simple data update; it’s a calculated move following a period of financial pressure. Netflix missed both profit and revenue expectations in its most recent earnings report, leading executives to emphasize that advertising is now a critical driver for future growth. The company has even stopped reporting its overall global paid memberships, a clear signal that its focus is shifting toward monetizing the viewers it already has through advertising.
With the ad-supported tier now available in 12 countries, Netflix is building what it calls a “solid foundation,” bolstered by stronger advertiser demand and expanded offerings through integrations with major players like Amazon, Google, and The Trade Desk.
Wall Street’s Bullish Outlook
Analysts are taking notice of the aggressive strategy. JPMorgan analyst Doug Anmuth predicts that these changes will significantly boost Netflix’s bottom line. He projects the company’s ad revenue will climb from $1.4 billion in 2024 to an impressive $2.9 billion in 2025. By 2026, that number could soar by another 45% to $4.2 billion, confirming that the era of advertising on the world’s biggest streamer is only just beginning.