What Just happened?

Netflix’s Q1 2025 results revealed the company made $10.5bn in revenue globally in the period, a 13% increase on Q1 2024. But if you were looking for subscriber totals, Netflix is no longer publishing them.  Starting this quarter Netflix will no longer be reporting how many subscribers it has, stating instead that revenue is a more meaningful measure of the health of its business. But Ampere estimates that Netflix ended the quarter with around 310m subscribers, marking 3% quarter-on-quarter subscriber growth. 

Netflix saw revenues grow in its domestic market by just over 2% quarter-on-quarter, down significantly on the growth it saw in its fourth quarter 2024 results. Ampere’s subscriber forecasts predicted a slowdown in the US market for the quarter, with net adds of just 1.15m over the quarter compared to 4m in Q4 2024. This growth slowdown, according to Netflix, was caused by tier changes due to price hikes, and the absence in Q1 of an equivalent advertising revenue bump to that seen in Q4 via its Christmas Day NFL Games. 

Netflix is usually the first major media company to release its quarterly earnings each reporting cycle, often setting the tone for the results that follow in the media industry. The fact that the streamer has beaten expectations might offer reassurance that the media market is well placed to weather any upcoming tariff-related economic pressure.   

So, how might Netflix be impacted by the Trump tariffs going forward? 

The effect of tariffs on most media companies (including Netflix) are most likely to be felt in two ways. Firstly, proposed tariffs will drive up inflation and hence impact the cost of living for US consumers in the short term. This will directly affect the ability of consumers to pay for media services within the household. With Netflix having just increased its prices in the US, it may be particularly vulnerable to either subscriber churn or consumers downgrading their tier. The second area we will likely see an impact on companies such as Netflix is through advertising spend — a sector which Ampere estimates will generate just over $1bn for the streamer in 2025. Some of the biggest advertisers in the US are from the food & drink, consumer goods, and travel sectors, which are particularly exposed to these proposed tariffs. If tariffs take effect, it could prompt a rethink in advertising budgets across the board.

However, there are some encouraging signs for Netflix that could put it in a strong position against the streaming competition. Firstly, Netflix’s business model, as it currently stands, is mostly focused on streaming alone. Competitors like Amazon, Apple, Disney are particular at risk from tariffs due to their e-commerce, consumer goods and hardware business lines (which in some cases largely support their streaming ventures). As a service-first media operator, Netflix is shielded somewhat from these dangers. Additionally, Netflix has heavily invested in producing local market content for its platform as a strategy to support the continued diversification of its subscriber base geographically, committing – for instance – to $1bn of content spend in Mexico and $2.5bn in South Korea over the next several years. The more geographically diversified the base, the less exposed the company will be to US-specific pressure. 

What comes next for Netflix?

Netflix was keen to talk about its advertising business during the first quarter results call, claiming it will double its revenues by the end of 2025. Doing that starts with the implementation of its in-house ad servicing platform, which began with the U.S. on 1 April 2025, and will roll-out to other markets in the coming months. By implementing this technology in-house Netflix claims it will provide a better ad experience for buyers and consumers. While it may be a challenging time for the advertising market, Netflix is planning for the long term. Any economic recovery following tariff-related fallout will be coupled with a rebound in marketer confidence.

All eyes will be on the US in the coming months as the tariff-related trade discussions unfold. While there is still a great deal of uncertainty about how the market will settle, Netflix’s global footprint, long-term bets on the advertising market, and lack of exposure in e-commerce or hardware mean it is well-positioned to weather any upcoming economic storm.