In the second quarter of 2025, Netflix Inc. reported significant growth in its financial performance. The company's revenues for the quarter amounted to $11.08 billion, marking a 16% increase from the same period in 2024. The growth in revenues was primarily attributed to an increase in memberships, higher pricing, and expanded advertising revenue.
The operating income for the quarter was $3.77 billion, representing a substantial 45% increase from the previous year. This surge in operating income was fueled by revenue growth outpacing the increase in cost of revenues, as well as a slower rate of growth in sales and marketing and general and administrative expenses relative to revenue growth.
Net income for the second quarter of 2025 reached $3.13 billion, marking a 46% increase over the same period in 2024. This growth was mainly driven by the significant increase in operating income, which was partially offset by a rise in the provision for income taxes and a decrease in foreign exchange gains and losses.
Regionally, the company experienced revenue growth across all segments. In the United States and Canada, revenues increased by 15%, while in Europe, the Middle East, and Africa (EMEA), revenues grew by 18%. Latin America (LATAM) saw a 9% increase in revenues, and the Asia-Pacific (APAC) region experienced a substantial 24% growth in revenues.
In addition to its core streaming membership fees, Netflix also earns revenues from advertisements presented on its streaming service, consumer products, live experiences, and various other sources. The company reported that revenues from sources other than monthly membership fees were not a material component of revenues for the period.
Netflix also provided constant currency revenue information, which showed that excluding the impact of foreign currency rate fluctuations, the company's revenue growth would have been even higher, at 17% for the quarter.
The company's cost of revenues primarily consists of the amortization of content assets. For the quarter, the cost of revenues amounted to $5.33 billion, representing a 3% increase from the same period in 2024. This increase was primarily attributed to higher content amortization relating to existing and new content.
Sales and marketing expenses for the quarter totaled $713 million, marking an 11% increase from the previous year. The rise in sales and marketing expenses was primarily driven by increased personnel-related costs and expenses associated with the company's advertising offering.
The market has reacted to these announcements by moving the company's shares -5.1% to a price of $1209.24. If you want to know more, read the company's complete 10-Q report here.
