Netflix dethrones Disney as analyst’s top media pick amid economic pressures

Stanley’s top pick: Morgan Stanley has named Netflix its top pick in Media & Entertainment, replacing Disney and underscoring the streamer’s resilience against macroeconomic pressures. The firm acknowledges the advertising landscape looks tenuous, with brand spend showing signs of softening, but notes Netflix’s two hours of daily engagement per user stands strong.

By the numbers: Analysts forecast Netflix’s ad revenue will climb from about $700 million in 2024 to roughly $1.3 billion in 2025. Though ads remain a relatively small slice of its business, Morgan Stanley points to Netflix’s decade-long record of subscriber growth and more than 94 billion hours streamed in the second half of 2024 as evidence of staying power. Meanwhile, Netflix’s new in-house ad tech platform, slated for rollout in 12 international markets this year, forms the backbone of its push into ad-supported streaming.

Streaming price woes: At the same time, a LendingTree survey of 2,000 U.S. consumers reveals a parallel undercurrent of dissatisfaction, with 72% of streaming subscribers saying they pay too much for platforms. Nearly a third have cut back and another third say they’re considering it, citing rising prices as the biggest concern. About 35% have tried negotiating for better rates, with two-thirds succeeding.

• The poll also uncovered a “binge and bolt” phenomenon, where more than half of subscribers sign up just to watch one show or sporting event and then cancel.

Ad-supported appeal: Netflix’s ad-supported plan could appeal to cost-conscious viewers who might otherwise “bolt,” while its big-budget content pipeline—anchored by major hits like Stranger Things and Squid Game in 2025—offers incentive to stick around.