Breaking Down How Netflix Earns Revenue and Scales Globally

Netflix’s subscription model is the backbone of its business and it’s anything but one-size-fits-all. 

The platform offers multiple pricing tiers, and this flexibility attracts a broader audience and it maximizes revenue by meeting customers where they are financially.

As of 2025, Netflix’s plans range from a basic ad-supported option to premium tiers offering perks like Ultra HD streaming and simultaneous device access.The higher the tier, the greater the benefits—and the higher the average revenue per user (ARPU). You can pick from carefully tiered plans: Standard with Ads ($7.99/month), Standard ($17.99/month), or Premium ($24.99/month). 

By meeting audiences at different price points, Netflix reduces churn, attracts cost-sensitive users, and still maximizes revenue from power users who want the best experience.

Here’s a simplified view of how Netflix’s subscription structure works:

Subscriptions renew monthly, so you’re always on the hook unless you cancel. Extra charges now apply for additional members outside your home, bumping up total spend.

In 2022, Netflix made a bold move: it introduced an ad-supported tier. For a company that once prided itself on being ad-free, this pivot signaled a new growth strategy because Netflix not only widened its audience but also tapped into an entirely different revenue stream. Now, ad-supported plans restrict access to select originals and include frequent ad breaks, while higher tiers grant the entire library.

For founders and app builders, the lesson is clear: giving users a choice creates more opportunities to capture value. Instead of forcing all users into one model, tiered pricing allows you to:

• Expand your user base with entry-level plans.
• Upsell power users who value advanced features.
• Stabilize revenue by diversifying streams across segments.

Think of Netflix’s model as proof that pricing is about how you structure the journey from entry-level users to loyal, premium subscribers. This approach is similar to the way AppMakers USA crafts scalable, client-first solutions. Here, we integrate subscription tiers based on the specific goals you set for your app. 

Netflix’s revenue story doesn’t stop at which plan you pick—it depends just as much on where you watch from. Subscription tiers and ad-supported options shape how much users pay, but geography determines how much revenue Netflix ultimately earns.

In 2024, Netflix generated $39 billion in total revenue, but almost half of that came from just two regions: the United States and Canada, which together pulled in $17.36 billion. Europe, the Middle East, and Africa (EMEA) followed at $12.39 billion, while Latin America and Asia Pacific trailed at $4.84 billion and $4.41 billion, respectively. Yet the fastest growth came from Asia Pacific, showing how future expansion often lies outside the most established markets.

Breakdown of Netflix’s 2024 Regional Revenue

Regional strategy matters. Netflix’s dominance in North America doesn’t stop it from investing in emerging markets where user growth potential is higher. For digital products, this means tailoring pricing, features, and even content to match regional behaviors can unlock massive opportunities.

Despite fierce competition, streaming success still hinges on one undeniable factor: what’s on the screen. Netflix’s $18 billion content investment planned for 2025—an 11% jump from 2024—shows how seriously you need to approach your content strategy in today’s market. 

Safe to say that original content is the fuel that keeps Netflix’s engine running. Starting with House of Cards in 2013, Netflix took the bold step of investing billions into producing its own shows and films. The gamble paid off: today, Netflix originals are brand-defining assets that drive subscriptions, retention, and cultural relevance.

Original programming on the other hand, gives Netflix full control of its content library. Instead of paying studios for licensing deals that might expire, Netflix owns the distribution rights. This means fewer disruptions to its catalog and more long-term value. Hits like The Crown, Wednesday, and Squid Game have also proven global blockbusters, drawing in new users across continents and cementing Netflix as a cultural powerhouse. 

The numbers back it up: in 2024, Netflix spent more than $17 billion on content creation. While costly, this investment creates a virtuous cycle—exclusive content attracts new viewers, keeps current subscribers engaged, and fuels spin-offs, merchandise, and even future licensing opportunities.

Here’s a simplified view of why original content is a growth engine:

Here, the lesson is powerful: sometimes the best growth strategy is building what only you can offer.

At AppMakers USA, we specialize in helping founders turn unique ideas into scalable products. From MVP development to long-term feature roadmaps, we ensure your app delivers the kind of exclusive value that keeps users loyal—just like Netflix’s originals do for its subscribers.

Beyond subscriptions and ads, Netflix generates meaningful revenue through licensing and strategic partnerships. As you have noticed, you’ll find Netflix everywhere, from Smart TVs by LG and Sony, to Samsung Galaxy devices loaded with exclusive extras.

Why?

When Netflix licenses its original shows and movies to other platforms, it creates an additional revenue stream while expanding the cultural footprint of its content. Think of blockbuster hits like Stranger Things merchandise or deals that allow Netflix content to appear on airline entertainment systems—these moves extend brand reach while adding dollars to the bottom line.

On the other side, partnerships also play a critical role. Netflix has teamed up with gaming giants like Xbox and PlayStation where Netflix reaches not just binge-watchers but also gamers. Or partnering with telecom providers like T-Mobile and ISPs worldwide to bundle its service with mobile or internet plans. These partnerships not only drive new subscriptions but also help Netflix secure distribution in competitive markets. 

The result is an ecosystem where Netflix is more than a standalone subscription, it becomes part of a package people already use daily.

So for founders, the key insight is this: your app doesn’t have to rely solely on direct subscriptions to thrive. Strategic partnerships—whether with carriers, platforms, or complementary services—can create new revenue channels and strengthen your product’s reach.

AppMakers USA helps startups identify and implement partnership opportunities that go beyond in-app revenue. From integrations to licensing strategies, we design ecosystems that turn apps into scalable businesses.

Netflix’s growth story is clearly seen in the numbers. If you’ve tracked Netflix’s financial headlines lately, the numbers just keep climbing, year after year, quarter after quarter. 

After building a foundation on subscriptions, expanding through ads, and fueling demand with original content, the company has entered an era of accelerating performance.

In Q2 2025 alone, revenue jumped 16% to $11 billion. Over the past twelve months, Netflix pulled in $41.7 billion, a nearly 15% year-over-year increase. Even more impressive, operating income surged 45% to $3.8 billion, while net income climbed to $8.7 billion, marking a staggering 61% leap.

What’s fueling this momentum? Three forces stand out:

• Subscriber Growth: Global subscribers have climbed to 277.6 million, with steady expansion across regions.
• Ad-Supported Acceleration: Advertising revenue is expected to “roughly double” in 2025, giving Netflix a powerful new growth lever.
• Favorable Currency Shifts: A weaker U.S. dollar has recently boosted Netflix’s international revenue forecasts.

Here are the key performance drivers to watch:

Netflix demonstrates how stacking strategies (subscriptions + ads + originals) can compound growth far beyond what a single lever could achieve.

Netflix’s revenue story is a roadmap for how digital products can scale. The company has layered multiple revenue levers that work together instead of relying on a single source. For app founders, this approach offers clear lessons:

1. Offer Flexible Pricing
   Netflix’s subscription tiers prove that different users have different budgets. Apps that provide multiple options—freemium, mid-tier, and premium—unlock growth without alienating price-sensitive users.
2. Experiment with Hybrid Models
   By introducing an ad-supported plan, Netflix showed that alternative monetization can open doors to entirely new audiences. Apps can replicate this by blending ads, sponsorships, or microtransactions with core subscription revenue.
3. Think Global, Act Local
   Geographic revenue distribution reveals the importance of tailoring offerings by region. Whether it’s adjusting pricing, localizing content, or partnering with regional platforms, apps that adapt can scale globally.
4. Build an Ecosystem Through Partnerships
   Netflix’s bundles with ISPs and telecoms highlight the power of collaboration. Apps that integrate with other services—or create distribution deals—can accelerate growth beyond their own marketing.
5. Invest in Unique Value
   Original content made Netflix indispensable. For apps, this translates to creating exclusive features, community-driven content, or proprietary tools that competitors can’t replicate.

Netflix’s Playbook

At AppMakers USA, we help startups apply proven strategies like these to their own products. Whether it’s designing monetization tiers, exploring ad-based revenue, or building unique value into your app, we turn big ideas into scalable business models.