January 25, 2023
Analyst Boosts Netflix '24 Ad Forecast To $2.1B, Cites Faster Ad-Option Growth
- by Joe Mandese @mp_joemandese, January 18, 2024
Citing stronger-than-expected ad-option subscriber growth, the equity research team at New Street Research this morning revised their 2024 ad revenue projection for Netflix up by $700 million to $2.1 billion.
Most of that ad spending ($1.231 billion) will come from the U.S. and Canada, with other markets increasingly accounting for …
So let's say that the analyst is substantially correct and the ad-supported Netflix service obtains about $1 billion in U.S. ad revenue this year. That's must be assuming that it can maintain its high CPM demands of around $45-50. But is that likely considering how small the service's overall coverage is?
When Netflix announced its decision to enter the ad-suppored field some of us---myself included---speculated that this move----if well executed----might develop into a much larger entity than it has become and U.S. ad revenue expectations were as high as $4 billion annually by this time. So while I and, I hope, others still wish Netflix success in the AVOD business, what we have seen so far is a huge disappointment. The launch was far too tentative and the initial offerings were hardly advertiser-friendly. Perhaps better is to come.---We shall see.