One of the more significant advertising stories developing this quarter is Netflix's continued push to build a substantial advertising business. The company confirmed in its Q1 2026 earnings that advertising revenue is on track to reach approximately $3bn in 2026, effectively doubling from the $1.5bn generated in 2025. That would represent the third consecutive year in which Netflix's advertising business has grown at more than 2.5 times its prior year level.

The numbers are notable in themselves. But the more interesting question for brands and agencies is what Netflix's advertising expansion signals about where retail media, streaming, and commerce data are heading together.

Netflix's advertising business at scale

The $3bn target is significant because it moves Netflix from an early-stage advertising experiment into a genuine advertising business operating at scale. For context, Netflix accounts for less than 5% of total TV viewership globally, and the platform has penetrated under 45% of its addressable broadband households. The $3bn figure is therefore not close to a ceiling. It is an early milestone in a US connected TV advertising market that is projected at approximately $38bn in 2026.

The structural fundamentals of Netflix's advertising growth are also strengthening:

• More than 60% of new subscribers in available markets are now choosing the ad-supported tier, confirming that it is no longer a budget alternative sitting below the premium product. It is the primary entry point onto the platform. 

• Netflix's advertiser base has grown to more than 4,000 brands, up 70% year-on-year. 

• And programmatic buying, which gives advertisers the flexibility and data integration that managed service deals cannot, is approaching 50% of Netflix's non-live advertising inventory, according to co-CEO Greg Peters on the earnings call.

The Amazon DSP connection

The development that connects Netflix's advertising expansion directly to retail media strategy is the Amazon DSP integration. From Q2 2026 in the US, advertisers buying Netflix inventory through Amazon DSP can apply Amazon Audiences (targeting segments built from Amazon users' shopping, browsing and streaming behaviour) to their Netflix campaigns.

This is the capability that makes the convergence concrete. Netflix provides the premium content environment and the scale. Amazon provides the commerce intelligence that qualifies the audience by purchase intent rather than demographic proxy. The combination gives advertisers a targeting layer on streaming television that has not been available before.

Why the brand versus performance distinction is dissolving

For most of advertising history, the distinction between brand advertising and performance advertising has been structural. Streaming television existed on the brand side: high reach, premium environments, emotional storytelling, measured on awareness and recall. Amazon advertising existed on the performance side: high-intent audiences, close to purchase, measured on ROAS and conversion.

That structural distinction is being dismantled by the same infrastructure that is driving Netflix's advertising growth. When Amazon's commerce audience data can be applied to a Netflix streaming placement, the advertising is no longer simply building brand awareness with a demographically appropriate audience. It is reaching an audience that is demonstrably in-market for a category, in a premium content environment, earlier in the consideration journey than the point of purchase.

The question of whether a campaign is a brand campaign or a performance campaign starts to become less meaningful when the targeting is grounded in purchase intent and the measurement can track exposure through to commercial outcome.

What this means for brands

The convergence happening at the Netflix and Amazon DSP intersection is representative of a broader structural shift across the advertising industry. 

Commerce data is fuelling advertising decisions across streaming television, premium publishers, video, and the wider open internet, not just within the ecommerce environments where it was originally generated.

For Amazon advertisers, this signals the continued evolution of Amazon from an ecommerce advertising platform into a broader advertising infrastructure layer. Amazon DSP is no longer the tool for retargeting audiences already close to purchase. It is increasingly the infrastructure through which commerce intelligence reaches audiences across the full breadth of their media consumption.

The practical question for brands is whether their planning frameworks have kept pace with that evolution. A strategy that separates a Netflix streaming buy from an Amazon Sponsored Products budget, optimises them independently, and measures them against different KPIs is missing the value that connects them. 

The brands that will capture the most from this convergence are those that plan across both environments with a unified audience logic and a measurement framework capable of tracking the full journey from awareness to purchase.

Want to understand how Netflix advertising through Amazon DSP fits into your brand's full-funnel strategy? Talk to the Vector Retail Media team.

"Commerce data is fuelling advertising decisions across streaming television, premium publishers, video, and the wider open internet, not just within the ecommerce environments where it was originally generated."